Rainbow, Inc. began operations on January 1 of the current year with a $12,000 cash balance. Forty percent of sales are collected in the month of sale; 60% are collected in the month following sale. Similarly, 20% of purchases are paid in the month of purchase, and 80% are paid in the month following purchase. The following data apply to January and February: January February
Sales $35,000 $55,000
Purchases 30,000 40,000
Operating expenses 7,000 9,000

If operating expenses are paid in the month incurred and include monthly depreciation charges of $2,500, determine the change in Sebestian's cash balance during February.

a. $5,000 increase
b. $7,500 increase
c. $8,000 increase
d. $4,500 increase
e. $2,000 increase

In march 2012, the state of california started requiring that all packaging for food and drink with the additive 4-methylimidazole (4-mi) be clearly labeled with a cancer warning. because of this, both pepsi and coke changed their formula to eliminate 4-mi as an ingredient. if pepsi and coke did not change their formula, holding all else constant, what would have happened to the demand for these goods, assuming pepsi and coke were in a competitive market? a. the demand curve for both pepsi and coke would have shifted to the right, causing the price of both products to decrease and the profits for the companies to fall. b. the demand curve for pepsi and coke would have remained unchanged, but the price of both products would have decreased and the profits for the companies would have fallen. c. the demand curve for pepsi and coke would have decreased, but the prices and profits would not have changed. d. the demand curve for only one of them would change because pepsi and coke are substitutes. e. the demand curve for pepsi and coke would have shifted to the left, causing the price of both products to decrease and the profits for both companies to fall.