When a firm faces constant returns to scale, . Multiple choice question. an increase in the quantity of input does not change the average total cost a decrease in the quantity of output changes the average total cost a decrease in the quantity of input changes the average total cost an increase in the quantity of output does not change the average total cost

In its first year of operations, sunland company recognized $30,000 in service revenue, $8,100 of which was on account and still outstanding at year-end. the remaining $21,900 was received in cash from customers. the company incurred operating expenses of $18,600. of these expenses, $12,880 were paid in cash; $5,720 was still owed on account at year-end. in addition, sunland prepaid $3,270 for insurance coverage that would not be used until the second year of operations. (a) calculate the first year's net earnings under the cash basis of accounting, and the first year's net earnings under the accrual basis of accounting.