GEICO, the number-two auto insurer with $18 billion in revenue last year, spent $0.9 billion on advertising that year and plans to continue spending the same percentage of sales on advertising next year. The average advertising-to-sales ratio for the insurance industry is 0.2 percent of sales. If GEICO projects $20 billion in sales next year, using the percentage-of-sales method of advertising budgeting, how much will the company budget for advertising if basing it on projected sales?

The purchasing agent for a company that assembles and sells air-conditioning equipment in a latin american country noted that the cost of compressors has increased significantly each time they have been reordered. the company uses an eoq model to determine order size. what are the implications of this price escalation with respect to order size? what factors other than price must be taken into consideration?

Exercise 7-7 martinez company reports the following financial information before adjustments. dr. cr. accounts receivable $168,900 allowance for doubtful accounts $3,200 sales revenue (all on credit) 849,300 sales returns and allowances 50,440 prepare the journal entry to record bad debt expense assuming martinez company estimates bad debts at (a) 4% of accounts receivable and (b) 4% of accounts receivable but allowance for doubtful accounts had a $1,550 debit balance. (if no entry is required, select "no entry" for the account titles and enter 0 for the amounts. credit account titles are automatically indented when the amount is entered. do not indent manually.)

Identify the level of the literature hierarchy for u. s. gaap to which each item belongs