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Average revenue (AR): total revenue per unit of a product sold;
Total revenue (TR): total number of dollars received by a firm or firm from the sale of a product;
Marginal revenue (MR):additional revenue received result from the sale of an extra unit of product;
Under perfect competition P=AR=MR and the firm's demand curve is flat.
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What is realisation concept in financial accounting?
Realization concept is also known as Revenue recognition concept. Under this concept revenue is said to be recognized by the seller when it is earned irrespective of cash received or not.
Which concept of revenue is called price?
Average revenue is nothing but the price of the product. Average revenue is the same as price of the commodity
Explain Why and how the concept of an organization is changing?
increase productivity, revenue.. etc
How to use the concept of price elasticity of demand to maximize revenue?
Price elasticity of demand is a way to determine marginal revenue. Optimal revenue and, more importantly, optimal profit will occur to the point when marginal revenue = marginal cost, or the price elasticity of demand < 1.
What is incremental concept?
The Incremental concept is estimating the impact of a business decision on costs and revenues, tressing the changes in total cost and total revenue that result from changes in prices, products, rocedures, investments, or whatevrmay be at stake in the decision. The two basic concepts in this analysis are incremental cost and incrementa revenue. 1.The change in total cost resulting from a decision. 2.The change in total revenue resulting from a decision.
What is realisation concept in financial accounting?
Realization concept is also known as Revenue recognition concept. Under this concept revenue is said to be recognized by the seller when it is earned irrespective of cash received or not.
The revenue recognition concept?
The revenue recognition concept is commonly used in accrual form of accounting. This indicates revenue should only be recorded when and entity is completed to a substantial level.
Recording revenue when a sale is made most directly relates to which concept?
Matching concept
Which concept of revenue is called price?
Average revenue is nothing but the price of the product. Average revenue is the same as price of the commodity
Demonstrate the Relationship between elasticity and totoal revenue?
how government use the elasticity concept to genrate revenue
What is associate with the accrual concept of accounting?
Revenue is recognised when earned.
Is associated with the accrual concept of accounting?
Revenue is recognised when earned.
What is associated with accrual concept of accounting?
Revenue is recognised when earned.
Income tax allocation procedures are justified by what concept?
revenue recognnition
Explain Why and how the concept of an organization is changing?
increase productivity, revenue.. etc
The revenue recognition concept states that revenue should be recorded in the same period as the cash is received?
False Because it determines when revenue is credited to a revenue account. Cash method means the transaction is reported when cash is received, but the revenue recognition concept means a transaction is reported as a sale even if no money has been paid. Cash basis does not recognize payable or receivable accounts.
What is the matching concept in financial accounting?
The Matching Concept: A significant relationship exists between revenue and expenses. Expenses are incurred for the for the purpose of producing revenue. In measuring net income for a period, revenue should be offset by all the expenses incurred in producing that revenue. This concept of offsetting expenses against revenue on the basis of "causes and effect" is called the Matching Concept. The term 'matching' means appropriate association of related revenues and expenses. In matching expenses against revenue the question when the payment was made or received is 'irrelevant'. For example if a salesman is paid commission in January, 2001, for sale made by him in December, 2000. According to this concept commission expense should be offset against sales of December 2000 because this expense is incurred for producing revenue in December 2000. On account of this concept, adjustments are made for all outstanding expenses, accrued revenues, prepaid expenses and unearned revenues, etc, while preparing the final accounts at the end of the accounting period.
