Philips Corp

question 50

Multiple Choice

Philips Corp. is unsure how to record the following transactions: •$60,000 of goods shipped F.O.B shipping point on December 28, 2012.
•$50,000 of goods shipped F.O.B. destination point on December 31, 2012.
What amount of sales related to these two transactions should Philips Corp. record in fiscal 2012?

• A)$0
• B)$50,000
• C)$60,000
• D)$110,000

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Definitions:

Long-run Adjustments

Changes a firm or industry makes over a long period to adapt to changes in demand, technology, or other economic factors.

Allocative Efficiency

Occurs when resources are distributed in a way that maximizes the net benefit to society, with goods and services produced at the level where the last unit provides a benefit equal to its cost of production.

Purely Competitive Industry

An industry characterized by many sellers offering identical products where each seller is a price taker due to market forces.

Supply

The complete volume of a good or service offered for sale at a specified price range in a certain market area.