(1) A choice is a tradeoff: A tradeoff is an exchange, i.e., giving up one thing to get something else.
Capital assets lose value over time due to wear and tear and obsolescence. Therefore, subtracting depreciation from gross capital expenditure (CAPEX) provides a more accurate picture of their actual value. Capital assets include all property and equipment that contribute to the productive capacity of the business.
Profit is the value remaining after a company's expenses have been paid. It can be found on an income statement.
The wage-price spiral is a macroeconomic theory used to explain the cause-and-effect relationship between rising wages and rising prices, or inflation.
Normal wear and tear refers to gradual damage that you would expect to see in a property over time. For example, worn carpets, faded curtains and minor scuffs and scrapes on the walls are all things that are extremely difficult if not impossible to avoid over a period of months and years.
You don't have to pay capital gains tax until you sell your investment. The tax paid covers the amount of profit — the capital gain — you made between the purchase price and sale price of the stock, real estate or other asset.
Types of Costs of ProductionFixed costs. Fixed costs are expenses that do not change with the amount of output produced. ... Variable costs. Variable costs are costs that change with the changes in the level of production. ... Total cost. Total cost encompasses both variable and fixed costs. ... Average cost. ... Marginal cost.
Excess of sales over cost of goods sold in an accounting period is termed as Gross Profit.
Key Takeaways. Production costs refer to the costs a company incurs from manufacturing a product or providing a service that generates revenue for the company. Production costs can include a variety of expenses, such as labor, raw materials, consumable manufacturing supplies, and general overhead.
Demand-pull inflation is often considered the most common type of inflation. ADVERTISEMENT. Sometimes demand-pull inflation can result from increases in government spending. For example, if the government puts money into a system where resources are limited, demand-pull inflation could follow.
Examples of Cost-Push Inflation A great example is oil, gasoline and the Organization of Petroleum Exporting Countries (OPEC). OPEC controls the majority of the world's oil reserves, and in 1973, it restricted production, causing prices to skyrocket 400%.
Cost-push inflation occurs when the costs of production are increased (e.g. wages or oil) and the supplier forwards those costs onto consumers. As inflation is a general rise in prices over time, this increases inflation.
You can only apply $3,000 of any excess capital loss to your income each year—or up to $1,500 if you're married filing separately. You can carry over excess losses to offset income in future years.
To carryback a capital loss, fill out section II on form T1A – Request for Loss Carryback. You do not have to file an amended return for the year to which you want the loss applied. The losses reported on form T1A lower your taxable income, resulting in either a refund or a reduction of your back taxes owed.
The IRS defines a capital improvement as a home improvement that adds market value to the home, prolongs its useful life or adapts it to new uses. Minor repairs and maintenance jobs like changing door locks, repairing a leak or fixing a broken window do not qualify as capital improvements.
$3,000Key Takeaways Capital losses that exceed capital gains in a year may be used to offset ordinary taxable income up to $3,000 in any one tax year. Net capital losses in excess of $3,000 can be carried forward indefinitely until the amount is exhausted.