SU Company signs an agreement on January 1, 2009, to lease equipment to Tiger Corporation. The following information relates to this agreement: The term of the non cancelable lease is 6 years with no renewal option. The equipment has an estimated economic life of 6 years. The cost of the asset to the lessor is $245,000. The fair value of the asset on January 1, 2009, is $245,000. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $43,622, none of which is guaranteed. The agreement requires annual rental payments, beginning Jan. 1, 2009. Collectability of the lease payments is reasonably predictable. There are no important uncertainties surrounding the amount of costs yet to be incurred by the lessor. The lessor’s rate of return is 10% and is known to the lessee. The lessee’s borrowing rate is 12%.

Please show clearly how to get present value(s).

A.) Calculate the annual rent payment.

B.) Prepare an amortization table

C.) Prepare all of the journal entries for the lessor for 2009 and 2010.

1.) Morse company has a sales budge of 75,000 units in July, 85,000 units in August and 70,000 units in September. Morse requires ending finished goods inventories equal to 40 percent of the following months sales. How many units should be budgeted for production in August? Assume that the beginning finished goods inventory in August was equal to the budgeted level.

2.)David Enterprise manufactures a product that requires three gallons of chemical XU-20 per unit. The cost of XU-20 is $30.00 per gallon. Davis maintains an ending inventory of XU-20 equal to 70 percent of the following month's production usage. Planned production for Davis is as follows: 6,000 units in June, 5,500 units in July and 7,200 units in August. What would be the cost of XU-20 budgeted to be purchased in July? Assume that beginning inventory of XU-20 in July was equal to the budgeted level.

3.)Rocky's Industrial Tool supply Company forecasts the following Total sales figures for the next 4 months. April $300,000- May $360,000- June $400,000- July $420,000. Cash sales average 30 percent of total sales and credit sales represent 70 percent of total sales. Credit sales are collected 80 percent in the months following sale and 20 percent two months following sale. The total estimated cash received in July would be:

what is the implication from the modified gray framework for the use of a common set of financial reporting standards across all countries?

Please explain what you did

Splat Candies is planning on building a new gumball factory that will have an estimated construction cost of $44 million. One-quarter of the cost of construction will be spent in the first year, with the remainder spent in the second year. During the third year (first year of operation), the gumminess of the gumballs slows down production so that profit of only $8 million is achieved. After that, the net yearly profit is $12 million for 9 years. At the end of the 12-year project life, the factory is shut down and sold as scrap metal for $2 million. Assume MACRS depreciation with a 7 year recovery period, a 9% interest rate and a corporate tax rate of 29%.

(a) Make a table showing cash flow, depreciation charge, taxes paid and after-tax cash flows for the 12 year project life, plus the year after the project ends. Excel is very useful for this.

(b) What is the cumulative net present value of the plant? (Hint: see Towler example 9.4)

(c) Calculate overall after-tax ROI for the project.

(d) Determine the internal rate of return (IRR, which is the same as DCFROR) for the project.

Exhibit 4
County Hospital Cost Allocation Data

Support Departments Housekeeping Direct Cost Space (Sq. Ft)

Housekeeping $500,000 8,000

General Administration $750,000 12,000

Maintenance $600,000 15,500

TOTAL SUPPORT DEPTS. $1,850,000 35,000

Patient Service Departments Direct Cost Space (sq. ft) revenues

Medicine $800,000 10,000 $970,000

Surgery $1,200,000 20,000 $3,600,000

Outpatient Adult $560,000 15,000 $720,000

Outpatient Pediatrics $470,000 12,000 $630,000

Total Patient Service Depts. $3,030,000   57,000   $5,920,000

County Hospital Totals $4,880,000   92,500 $5,920,000

27. Assume that managers want to allocate housekeeping costs to the patient service departments. What is the value of the housekeeping cost pool? (2 points)

1. 8,000 sq feet

2. 57,000 sq feet

3. $500,000

4. $1,850,000

Page 7 of 8

28. Assume that space will be the cost driver and that managers want to use the direct cost allocation method. What is the total amount for the cost driver? (2 points)

1. 57,000 sq feet

2. 35,500 sq feet

3. 92,500 sq feet

4. None of the above

29. What is the appropriate allocation rate for the housekeeping cost pool if space is the cost driver and using the direct cost allocation method? (2 points)

1. $5.40 per sq foot

2. $14.08 per sq foot

3. $8.77 per sq foot

4. None of the above

30. Assuming that the cost driver for housekeeping costs is space and using the direct cost allocation method, what is the allocation of housekeeping costs to the Medicine Department? (2 points)

a. $ 87,720
b. $ 54,000
c. $ 140,800
d. None of the above

The income statement and additional data of Bayleaf Pty Ltd are as follows:

Income statement for the year ended 31 December 2016

Revenue:

Service Revenue R225 000

Dividend Revenue R6 300 (231 300)

Expenses:

Cost of goods sold R100 000

Salary Expense R52 000

Depreciation Expense R23 000

Advertising Expense R2 300

Interest Expense R2 400

Income tax expense R5 000 (R184 700)

Net income R46 600

Additional Data:

a) Acquisition of PPE was R170 000. Of this amount , R140 000 was paid in cash and R30 000 by signing a note payable

b) Proceeds from the sale of land totalled R48 000

c) Proceeds from issuance of shares totalled R31 000

d) Payment of long-term note payable was R16 000

e) Payment of dividends was R10 000

From the Balance Sheet:

Balance sheet as at 31 December

Currents Assets 2016 2015

Cash R32 000 R13 300

Accounts Receivable R41 000 R57 000

Inventory R48 000 R87 000

Prepaid expenses R9 100 R8 200

Current Liabilities

Accounts Payable R32 000 R17 000

Accrued liabilities R14 000 R43 000

Required:

1. Prepare Bayleaf 's statement of cash flow for year ended 31 December 2016, using indirect Method.

2. Evaluate Bayleaf's cash flow for the year ended 31 December 2016, including its free cash flow and cash realization ratio. In your evaluation, review all three categories of cash flows and give the reason for your evaluation.

3. When analyzing the cash flow patterns of the Company, what other three (3) important indicators of the health of the company 's cash flows do you look at?

BluStar Company has two service departments, Administration and Accounting, and two operating departments, Domestic and International. Administration costs are allocated on the basis of employees, and Accounting costs are allocated on the basis of number of transactions. A summary of BluStar operations follows.

Required:

a. Allocate the cost of the service departments to the operating departments using the direct method.
b. Allocate the cost of the service departments to the operating departments using the step method. Start with Administration.
c. Allocate the cost of the service departments to the operating departments using the reciprocal method.

All of the following are reported at fair value except

A. Trading securities

B. Held to maturity securities

C. Available for sale securities

D. All of these options are reported at fair value

On January 1 of the current year, Winters Corporation acquired 10% of the outstanding common stock of Summers Corporation for $420,000. For the current year, Summers Corporation reported net income of $80,000 and paid cash dividends of $25,000. At the end of the year, the carrying value of Winters’ investment in Summers Corporation would be

Myriad Solutions, Inc. issued 12% bonds, dated January 1, with a face amount of $490 million on January 1, 2021, for $438,089,694. The bonds mature on December 31, 2030 (10 years). For bonds of similar risk and maturity the market yield is 14%. Interest is paid semiannually on June 30 and December 31.

Required:
Calculate the amounts related to the bonds that Myriad would report in its financial statements. (Round your answers to the nearest whole dollar.)

Net Liability = _____

Financing = _____

Atlantic Imports, a U.S. company, acquired a wholly-owned subsidiary, located in Portugal, on January 1, 2018 for €200,000,000. The subsidiary’s functional currency is the euro. The balance sheet of the subsidiary at the date of acquisition was as follows: Assets Current assets € 30,000,000 Noncurrent assets, net 150,000,000 Total assets €180,000,000 Liabilities and Stockholders' Equity Liabilities € 60,000,000 Capital stock 80,000,000 Retained earnings 40,000,000 Total liabilities and stockholders' equity €180,000,000 Appropriate revaluations of the subsidiary’s assets at the date of acquisition are as follows: Inventories are undervalued by €500,000. The subsidiary uses FIFO. Noncurrent assets are undervalued by €10,000,000. The noncurrent assets have a 10-year remaining life, straight-line. Identifiable indefinite life intangible assets, previously unreported, have a fair value of €5,000,000. During 2018 there was no impairment of either identifiable intangible assets or goodwill. The exchange rate on January 1, 2018 was $1.10/€. The average rate for 2018 was $1.12/€, and the rate at the end of 2018 was $1.15/€. The excess of acquisition cost over book value for this acquisition, in U.S. dollars, is: The entries required to consolidate the balance sheets of Atlantic Imports and its subsidiary at the date of acquisition include recognition of goodwill of: The entries required to consolidate the balance sheets of Atlantic Imports and its subsidiary at the date of acquisition include an increase in the subsidiary's noncurrent assets in the amount of: At the end of 2018, consolidation eliminating entry (R) includes a debit to current assets in the amount of: At the end of 2018, consolidation eliminating entry (O) includes a debit to depreciation expense in the amount of: At the end of 2018, consolidation eliminating entries (R) and (O) together will have what effect on consolidated other comprehensive income (increase or decrease)?

1. Match with the proper definition

A. CFO

B. Fixed Cost

C. Indirect Cost

D. Management by exception

E. Non - Controllable Cost

F. Opportunity Cost

G. Sunk Cost

H. Supply Chain Management Systems

I. Value Chain

J. Variable Cost

_____The benefits forgone when one alternative is selected over another

_____Organize the activities between a company and its suppliers

_____A cost that does not change, in total, with changes in the level of business activity

_____investigating departures from the plan that are significant

_____ A cost that was incurred in the past

_____A cost that cannot be easily traced to a particular cost object

_____A cost that does not change on per unit basis with changes in the level of business activity

_____The senior executive responsible for accounting and financial operations

_____ A company internal operations and its relationships and interactions with suppliers and customers

_____ A cost that a manager cannot Influence

The Director of Annie Smith Dance Center is asking for assistance with the financial aspects of running a professional group of performers. She wants financial information presented in an easy to read format and a better understanding of the profitability of the concerts and the organization as a whole.

The Annie Smith professional group features three styles of dance concerts each year. Two of the dance concerts showcase a different genre. The third performance is a Christmas Spectacular, which is the most popular and is therefore scheduled every year. The table below provides information about expected ticket sales for the performances.

Ms. Smith has prepared a tentative schedule for the coming season. The table below also shows the type and number of performances and direct cost per type of concert.

*Examples of direct fixed costs are costumes, rehearsals, royalties, guest artist fees, choreography, and salaries of production staff, music, and wardrobe for each of the concerts. This amount does not change with the number of performances.

Additional costs:

Variable costs associated with each performance are shown below.

Annual general administrative and operating costs for the dance center are:

Ms. Smith wants the Dance Center to generate at least $300,000 in operating profit. What level of revenues does the performance group need to achieve to meet this goal? Prepare an income statement in good format to support the computations.

No Calculations necessary I am only asking for format and necessary formulas.

Thanks in advance!

You decided to start up 3-D Printing Prototyping business. In October of 2020, you:

Invest $10,000 of your own money

. • Raise an additional $20,000 from family and friends (as equity). You also borrow another $10,000 from them that you agree to pay back in 6-months time

. • Secure operating space and prepay for 3-months of space at $3,000 a month. Your landlord let you in a couple days early to set up before your grand opening at no additional cost.

• Purchase 3-D printers totalling $20,000.

• Purchase computers and related equipment totalling $12,000

• Purchase $4,000 worth of 3-D printing supplies (printer filament)

Your grand opening is set for Nov 1. Complete the balance sheet for this company as of Nov 1.

Over the next 3-months you:

Complete prototyping work worth $30,000. This work required $8,000 of your printing supplies. During this time you also purchased another $10,000 worth of printing supplies.

• You also receive payment for a $2,000 job that will completed over the first month of the next quarter.

• You didn’t pay any additional rent given that you prepaid it in October

. • Utilities (electricity, water, etc) were 20% of your rent.

• You hired an assistant for the last two months, paying them $2,000 a month.

• Marketing costs were $3,000.

• You also paid $500 in interest on your loan and paid back $2,000 in principal (earlier than expected)

. • Taxes are expected to be 20% of your income.

• You can ignore depreciation.

Complete an income statement for those first three months.

Oxen Corp. has 1,000 shares of common stock outstanding. Cherith owns 400 of these shares and Marshall owns 600. Marshall’s total basis in his 600 shares is $40,000. Oxen has $500,000 of accumulated E&P as of the beginning of the year, and Oxen is profitable this year. Assume that Oxen redeems 210 shares of Marshall’s stock during the year for $80,000. Marshall seeks to determine if the redemption qualifies for sale treatment as a disproportionate redemption under Section 302(b)(2). Would Marshall pass the 50% test under Section 302(b)(2)? a. yes. b. no.