Carreker, Inc., has a number of divisions, including the Alamosa Division, producer of surgical blades, and the Tavaris Division, a manufacturer of medical instruments. Alamosa Division produces a 2.6 cm steel blade that can be used by Tavaris Division in the production of scalpels. The market price of the blade is $21. Cost information for the blade is:

Variable product cost $ 9.70

Fixed cost 5.50

Total product cost $15.20

Tavaris needs 15,000 units of the 2.6 cm blade per year. Alamosa Division is at full capacity (90,000 units of the blade).

1. If Carreker, Inc., has a transfer pricing policy that requires transfer at full product cost, what would the transfer price be? Do you suppose that Alamosa and Tavaris divisions would choose to transfer at that price?
2. If Carreker, Inc., has a transfer pricing policy that requires transfer at full cost plus 25 percent, what would the transfer price be? Do you suppose that Alamosa and Tavaris divisions would choose to transfer at that price?
3. If Carreker, Inc., has a transfer pricing policy that requires transfer at variable product cost plus a fixed fee of $2.00 per unit, what would the transfer price be? Do you suppose that Alamosa and Tavaris divisions would choose to transfer at that price?
4. What if Alamosa Division plans to produce and sell only 65,000 units of the 2.6 cm blade next year? The Carreker, Inc., policy is that all transfers be at full cost. Which division sets the minimum transfer price, and what is it? Which division sets the maximum transfer price, and what is it? Do you suppose that Alamosa and Tavaris divisions would choose to transfer?

You are managing a portfolio and considering whether to adopt either one of two trading strategies. In the value strategy, you would hold a portfolio consisting of the 300 stocks with the highest book-to-market ratio. In the seasonality strategy, you would hold a portfolio consisting of the 300 stocks with the highest returns in the upcoming calendar month of the previous year. In both cases, you would rebalance portfolios at the end of each month. Suppose you forecast that both strategies would earn the same average monthly return (before trading costs) and same monthly standard deviation. Which strategy would you follow and why?

Heidi is 17 years old and a dependent of her parents. She receives $8,700 of wages from a part-time job and $9,200 of taxable interest from bonds she inherited.

FIND OUT

-taxable income and

-tax.

STANDARD DEDUCTION

Filing Status

Married individuals filing joint returns and surviving spouses

$24,400

Heads of households

$18,350

Unmarried individuals (other than surviving spouses and heads of households)

$12,200

Married individuals filing separate returns

$12,200

Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses

$1,300*

Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse

$1,650*

Taxpayer claimed as dependent on another taxpayer’s return: Greater of (1) earned income plus $350 or (2) $1,100.

* These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind.

Child's tax rate brackets:

10% tax rate: Portion of taxable income not over ETI plus $2,600

24% tax rate: Portion of taxable income over ETI plus $2,600 but not over ETI plus $9,300

35% tax rate: Portion of taxable come over ETI plus $9,300 but not over ETI plus $12,750

37% tax rate: Portion of taxable income over ETI plus $12,750

Single

If taxable income is:

The tax is:

Not over $9,700. . . . . . . . . . . . . . . . . . .

10% of taxable income.

Over $9,700 but not over $39,475. . . .

$970.00 + 12% of the excess over $9,700.

Over $39,475 but not over $84,200. . .

$4,543.00 + 22% of the excess over $39,475.

Over $84,200 but not over $160,725. .

$14,382.50 + 24% of the excess over $84,200.

Over $160,725 but not over $204,100

$32,748.50 + 32% of the excess over $160,725.

Over $204,100 but not over $510,300

$46,628.50 + 35% of the excess over $204,100.

Over $510,300. . . . . . . . . . . . . . . . . .

$153,798.50 + 37% of the excess over $510,300.

cumulative preferred stock mean

Suppose that you are a portfolio manager for an actively managed portfolio. Your mandate is to beat a benchmark index by holding a portfolio of some subset of stocks in the index. You cannot short sell stocks or trade derivatives. You develop a quantitative model to calculate a “price target” for every stock in the benchmark index. Explain how you could use these price targets to manage your portfolio.

Which of the following approaches is NOT an avenue for changing the position of Arm & Hammer Baking Soda in the minds of consumers in order to extend the product life cycle and increase sales?

Increasing trade promotions

Adding new distribution outlets for the product

Enlarging the target market

Identifying jobs other than baking

Identifying new usage situations

Walsh Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations:

Variable costs per unit:

Manufacturing:

Direct materials $ 29

Direct labor $ 11

Variable manufacturing overhead $ 3

Variable selling and administrative $ 2

Fixed costs per year:

Fixed manufacturing overhead $ 400,000

Fixed selling and administrative expenses $ 90,000

During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company’s product is $82 per unit.

Required:

1. Assume the company uses variable costing: a. Compute the unit product cost for Year 1 and Year 2.

b. Prepare an income statement for Year 1 and Year 2.

2. Assume the company uses absorption costing: a. Compute the unit product cost for Year 1 and Year 2.

b. Prepare an income statement for Year 1 and Year 2.

3. Reconcile the difference between variable costing and absorption costing net operating income in Year 1.

INDIRECT METHOD - STATEMENT CASH FLOW

Using information below, Create a Statement of Cashflow (INDIRECT METHOD)

**Note: create the statement for the year of 2018 only.

Net Income from Income statement: $105,000.00

the Retained Earnings was $80,000.00

Small Appliances Division Cleaning Products Division

Sales $34,670,000 $31,320,000

Operating income 2,773,600 1,252,800

Operating assets, January 1 6,394,000 5,600,000

Operating assets, December 31 7,474,000 6,000,000

Forchen, Inc., requires an 8 percent minimum rate of return.

For the Small Appliances Division, calculate:

a. Average operating assets

b. Margin

c. Turnover

d. Return on investment (ROI)

2. For the Cleaning Products Division, calculate:

a. Average operating assets

b. Margin

c. Turnover

d. Return on investment (ROI)

3. What if the minimum required rate of return was 9 percent? How would that affect the residual income of the two divisions?

Selected account balances before adjustment for Atlantic Coast Realty at July 31, the end of the current year, are as follows:

Data needed for year-end adjustments are as follows:

1. Journalize the six adjusting entries required at July 31, based on the data presented. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 10

JOURNAL

ACCOUNTING EQUATION

2. What would be the effect on the income statement if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?

3. What would be the effect on the balance sheet if the adjustments for unbilled fees and accrued wages were omitted at the end of the year?

4. What would be the effect on the “Net increase or decrease in cash” on the statement of cash flows if the adjustments for unbilled fees and accrued wages were omitted at the end of the year? over/understated/no effect

To support growth strategies and combat competition with rivals, businesses seek external capital to further develop products and services in hopes to create new sales opportunities. Since capital investment often involves a huge money investment, longer time engagement and risks of uncertainties, any decision shall not be taken lightly and shall be carefully evaluated before putting money to start a long-term project. The goal is to ultimately make the right accept/reject decision. Respond to the following in a minimum of 175 words:

Briefly describe (not define) the six models of a capital budgeting decision, which are typically defined as a 'go or no-go' decision. These are -

1. Payback period (standard)
2. Discounted payback period (modified from payback period)
3. Net present value (NPV) (standard)
4. Internal rate of return (IRR) (standard)
5. Modified internal rate of return (MIRR) (modified from IRR)
6. Profitability index (PI) (modified from NPV)

In reviewing these, which one(s) is appropriate for small projects and which one(s) is appropriate for larger projects?

Which criteria and techniques do you consider the most useful? Please explain

Please choose one of these models and provide an example by showing the model's calculation in action.

can you explain step by step: Chapter 16 accounting intermediate II -Basic and diluted EPS

1-Assume that the following data relative to Rice company for 2020 is available:

transactions in common shares change    Cumulative

Jan. 1,2020 Beginning number    650,000

Apr 1,2020 Purchase of treasury shares (50,000) 600,000

June 1,2020 100% Stock dividend 600,000 1,200,000

Dec 1,2020 Issuance of shares 200,000 1,400,000

5% cumulative convertible preferred stock

$1,000,000 sold at par on January 1, 2020 convertible into 200,000 shares of common stock

Stock options:

Exercisable at the option price of $30 per share. Average market price in 2020, $35 and there were 60,000 options outstanding since 2017

(A) compute the basic earnings per share for 2020.

(B) compute the diluted earnings per share for 2020

The following accounts and balances were drawn from the records of Barker Company at December 31, Year 2:

Required

Use the accounts and balances from Barker Company to construct an income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows (show only totals for each activity on the statement of cash flows).

Yield to call

Seven years ago the Singleton Company issued 24-year bonds with a 11% annual coupon rate at their $1,000 par value. The bonds had a 6% call premium, with 5 years of call protection. Today Singleton called the bonds.

Compute the realized rate of return for an investor who purchased the bonds when they were issued and held them until they were called. Round your answer to two decimal places.

%

Explain why the investor should or should not be happy that Singleton called them.

Since the bonds have been called, interest rates must have risen sufficiently such that the YTC is greater than the YTM. If investors wish to reinvest their interest receipts, they can now do so at higher interest rates.

Since the bonds have been called, interest rates must have risen sufficiently such that the YTC is greater than the YTM. If investors wish to reinvest their interest receipts, they must do so at lower interest rates.

Since the bonds have been called, investors will receive a call premium and can declare a capital gain on their tax returns.

Since the bonds have been called, investors will no longer need to consider reinvestment rate risk.

Since the bonds have been called, interest rates must have fallen sufficiently such that the YTC is less than the YTM. If investors wish to reinvest their interest receipts, they must do so at lower interest rates.

Calculate the unknown amounts appearing in each column: