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A rapid rise in profits relative to other types of income would affect?
Wiki User
∙ 11y ago
Both the functional and personal distributions of income
Wiki User
∙ 11y ago
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What five categories of income make up national income?
Wages and salaries, income of self employed individuals, rental income, corporate profits, and interest on savings and other investments
What factors will shift the supply and demand for currency?
Confidence in the economy. If the economy of the country is doing good, it is likely that the confidence in that currency is high, raising the demand. However, when the economy is sloppy, the lack of confidence brings down the demand level. Level of exports and imports Relative income changes (Higher income in other countries => go on holidays and thus rising demand for other currencies.) Relative interest rate (High interest rate => high return => people invest more in it)
How does inflation affect the balance of payments?
Inflation affects low income earners more than high income earners. This is because low income earners' income tends not to rise as quickly as prices, therefore, their purchasing power decreases. Also, low income earners do not have the skills to demand higher wages. It should be noted that high inflation generally leads to interest rate increases. This affects low income earners' cost of living and compounds the other affects of inflation. So, inflation decreases purchasing power of low income earners relative to high income earners, whose income increase as quick as inflation. Ultimately, income distribution becomes less equal.
What are the factors affecting Demand and supply of goods?
price is the main factor which affect demand and supply and other factors which affect demand and supply are change in income weather change living standard of people alternative things superior to inferior
What was disposable income in the 1920s?
The income remaining when all other necessities have been deducted from your income.
How does dividends affect net income?
Answer:Dividends are a distribution of net income. That means dividends is not included in the calculation of net income. Dividend payments do affect net income indirectly. If a company pays a dividend, cash is reduced. This cash can no longer be used to generate profits. That is why 'cash cow' companies pay out the bulk of their profits as dividends (few or no new investment opportunities available) and growth firms retain all profits.
What is the difference between absolute income and relative income?
Relative income measures your income in relation to other members of society, weighing it against the standards of the day. Absolute income, meanwhile, does not take into consideration those other factors, but simply reflects the total amount of earnings you have received in a given period.
What five categories of income make up national income?
Wages and salaries, income of self employed individuals, rental income, corporate profits, and interest on savings and other investments
How does the goodwill affect net income?
Goodwill is the value of reputation of a irm in respect of the profits expected in future over and above the normal rate of return, which other companies can earn. Over and above the normal rate implies that the firms capability to earn more profits when compared to other firms because of its good brand name, locational advantage, good customer relations or possession of a unique patent right. The impact of goodwill on the net income is that, as good will is amortized the amount of profits get reduced. This further reduces the balacne of reserves and surplus amt in the balance sheet.
Do the balance sheet accounts or income statement figures seem to be primarily responsible for the low profits?
The Income Statement is the financial report that calculates net income (profits) so that is one place to look for the reason behind low profits. However, if the company doesn't have enough cash or other resources or it has too much debt, it could cause them to miss opportunities for sales or for financing to get the necessary resources. The structure of the income statement is: + Revenue - Costs of Goods Sold (direct cost of the product sold above) ___________________ = Gross Profit - Operating Expenses (related to usual costs of running of business) _____________________ = Operating Profit + Other Income (gains on sale of assets or other unusual "money in") - Other Expenses (losses on sale of assets or other unusual "money out") ______________________ Net Profit (Income)
In a HUF if the Karta has income from salary will his salary income be treated as the salary income or an income for HUF?
Which income is regarded as HUF income?There are five heads of income:1. Salary2. Profits from business or profession3. Income from house property4. Capital gains5. Income from other sourcesSince the HUF is a separate entity, it can earn income from all the above except income from salary.All income that arises on the investment of the HUF's funds and utilisation of its assets is regarded as income and is separately assessed and taxed.
What is considered income on your income tax returns?
Gross income. General definition. Gross income means all income from whatever source derived unless excluded by law. Section 22 GROSS INCOME: (a): Gross income includes* gains, profits, and income derived from salaries, wages, or compensation for personal service...
How income statement affect balancesheet?
Income statement and balance sheet are both related to each other as transactions effect income statement and balance sheet as well and net income or loss from income statement is also part of balance sheet.
Can you file even if you had no earned income?
Yes. You have to pay taxes on both earned and unearned income. In tax language "earned income" means income from a job or self-employment. "Unearned income" is other income such as interest on your bank accounts or profits from investments. A sufficient amount of earned or unearned income requires you to file. Even if you do not have enough income to be required to file, you can still file. If you really want, you can even file if you have no income of any kind.
What is Substantial interest under income tax act?
An individual shall be deemed to have substantial interest in a concern (a) In a case wehere the concern is a comapny, he by himself or along with his relative beneficially holds equity shares carrying not less than 20% of voting power; (b) In any other case, he or himself or together with his relatives is entitled to 20% of profits of such concern.
Do businesses pay taxes?
In one way or another, they pay income taxes on profits, property, vehicles, and every other tax that everyone else pays. Depending on the type of business and how it is formed, determines how the income tax is paid and on what type of tax return.
What is Relative Income Hypothesis?
The Relative Income Hypothesis posits that an individual's consumption and savings decisions are more influenced by their relative income or position in society, rather than just their absolute income level. This theory suggests that people tend to compare their income and consumption to those of others around them, impacting their financial behavior.
