Jordan Technologies, Inc. has three divisions. Jordan has a desired rate of return of 12.0 percent. The operating assets and income for each division are as follows:

Jordan headquarters has $129,000 of additional cash to invest in one of its divisions. The division managers have identified investment opportunities that are expected to yield the following ROIs:

Required

1. a-1. Calculate the ROI for each division.

2. a-2. Which division manager is currently producing the highest ROI?

3. b. Based on ROI, which division manager would be most eager to accept the $129,000 of investment funds?

4. c. Based on ROI, which division manager would be least likely to accept the $129,000 of investment funds?

5. d. Which division offers the best investment opportunity for Jordan?

6. g. Calculate the residual income:

1. (1) At the corporate (headquarters) level before the additional investment.

2. (2) At the division level before the additional investment.

3. (3) At the investment level.

4. (4) At the division level after the additional investment.

anson, Mahoney, and Longval, a parmership, is considering admitting Kellan Young as a new parmer. On July 31, 2016, che capical accouncs of the three existing parmers and their profi(-and-loss-sharing ratio is as follows; Learning Objectives 2, 3 2. Clay, Capital $55,000 Partnerships 661 LearningObjective4 4. Longval, Capital $15,400 DR Hanson Mahoney Longval Requirements Capital $ 42,000 84,000 126,000 Profit-and-Loss-Sharing % 20% 25% 55% Journalize che admission of Young as a partner on July 31 for each of the following independent situations: l. Young pays Longval $168,000 cash co purchase Longval's interest. 2. Young conuibutes $84,000 to the parmership, acqu.iring a 1/4 interest in the business. 3. Young contributes $84,000 co the partnership, acqujring a l/6 interest in the business. 4. Young conuibures $84,000 to che parmership, acquiring a 1/3 interest in the business.

On June 30, 2018, Georgia-Atlantic, Inc., leased warehouse equipment from Builders, Inc. The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $414,921 over a 5-year lease term, payable each June 30 and December 31, with the first payment at June 30, 2018. Georgia-Atlantic's incremental borrowing rate is 8.0%, the same rate Builders used to calculate lease payment amounts. Builders manufactured the equipment at a cost of $3.0 million. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Required: 1. Determine the price at which Builders is “selling” the equipment (present value of the lease payments) at June 30, 2018.

2. What amounts related to the lease would Builders report in its balance sheet at December 31, 2018 (ignore taxes)?

3. What amounts related to the lease would Builders report in its income statement for the year ended December 31, 2018 (ignore taxes)? (For all requirements, enter your answers in whole dollars and not in millions. Round your final answer to nearest whole dollar.)

You have just sat through an informative lecture in your managerial accounting class about the net present value (NPV). However, one of your classmates leaned over to tell you that he is still unclear about this theory and would like for you to provide a summary of what this concept is all about and why it is so important. Explain to your classmate the key arguments for using NPV over other capital investment approaches and why it is the preferred method for making decisions about long-term investment opportunities.

Homestead Oil Corp. was incorporated on January 1, 2019, and issued the following stock for cash: 820,000 shares of no-par common stock were authorized; 150,000 shares were issued on January 1, 2019, at $18.00 per share. 260,000 shares of $90 par value, 9.00% cumulative, preferred stock were authorized; 76,000 shares were issued on January 1, 2019, at $130 per share. Net income for the years ended December 31, 2019 and 2020 was $1,350,000 and $2,660,000, respectively. No dividends were declared or paid during 2019. However, on December 28, 2020, the board of directors of Homestead declared dividends of $1,480,000, payable on February 12, 2021, to holders of record as of January 19, 2021.

1. Use the horizontal model for the issuance of common stock and preferred stock on January 1, 2019. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.)

2. Use the horizontal model for the declaration of dividends on December 28, 2020. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.)

3. Use the horizontal model for the payment of dividends on February 12, 2021. Indicate the financial statement effect. (Enter decreases with a minus sign to indicate a negative financial statement effect.)

What is the motivation for a company to legally reorganize? What parties are the “losers” of a reorganization? What parties are the “winners”?

Amsterdam Company uses a periodic inventory system. For April, when the company sold 600 units, the following information is available. Units Unit Cost Total Cost April 1 inventory   250 $10 $ 2,500 April 15 purchase   400  12   4,800 April 23 purchase   350  13   4,550 1,000 $11,850 Compute the April 30 inventory and the April cost of goods sold using the average-cost method.

Sako Company’s Audio Division produces a speaker that is used by manufacturers of various audio products. Sales and cost data on the speaker follow:

Sako Company has a Hi-Fi Division that could use this speaker in one of its products. The Hi-Fi Division will need 10,000 speakers per year. It has received a quote of $29 per speaker from another manufacturer. Sako Company evaluates division managers on the basis of divisional profits.

Required:

1. Assume the Audio Division is now selling only 47,000 speakers per year to outside customers.

a. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division?

b. From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division?

c. What is the range of acceptable transfer prices (if any) between the two divisions? If left free to negotiate without interference, would you expect the division managers to voluntarily agree to the transfer of 10,000 speakers from the Audio Division to the Hi-Fi Division?

d. From the standpoint of the entire company, should the transfer take place?

2. Assume the Audio Division is selling all of the speakers it can produce to outside customers.

a. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division?

b. From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division?

c. What is the range of acceptable transfer prices (if any) between the two divisions? If left free to negotiate without interference, would you expect the division managers to voluntarily agree to the transfer of 10,000 speakers from the Audio Division to the Hi-Fi Division?

d. From the standpoint of the entire company, should the transfer take place?

Corrientes Company produces a single product in its Buenos Aires plant that currently sells for 6.80p per unit. Fixed costs are expected to amount to 56,000p for the year, and all variable manufacturing and administrative costs are expected to be incurred at a rate of 2.30p per unit. Corrientes has two salespeople who are paid strictly on a commission basis. Their commission is 8 percent of the sales revenue they generate. (Ignore income taxes.) (p denotes the peso, Argentina’s national currency. Many countries use the peso as their national currency. On the day this exercise was written, Argentina’s peso was worth .104 U.S. dollar.)

1a) Suppose management alters its current plans by spending an additional amount of 4,300p on advertising and increases the selling price to 7.80p per unit. Calculate the profit on 66,000 units. (Do not round intermediate calculations. Enter your answer in pesos.)

1b) The Sorde Company has just approached Corrientes to make a special one-time purchase of 19,000 units. These units would not be sold by the sales personnel, and, therefore, no commission would have to be paid. What is the price Corrientes would have to charge per unit on this special order to earn additional profit of 43,700p? (Round your answer to 2 decimal places. Enter your answer in pesos.)

1c) What is Leno’s current selling price of item no. 8976?

1d) If Leno used target costing for item no. 8976, what must happen to costs if the company desires to meet the market price and maintain its current rate of profit on sales? By how much?

1e) Would the identification of value-added and non-value-added costs assist Leno in this situation? (Yes or No)

1f) Suppose that by previous cost-cutting drives, costs had already been “pared to the bone” on item no. 8976. What might Leno be forced to do with its markup on cost to remain competitive? By how much? (Do not round intermediate calculations. Round your percentage answer to 2 decimal places (i.e., .1234 should be entered as 12.34).)

1g) In many industries, prices are the result of an interaction between market forces and costs. (True or False)

This is my question from the subject of principles of income tax law below:

Nikki owns and carries on a chain of clothing stores. So far she has 7 of such stores. When she chooses a premises to open a new store on, the most important criterion is where she can maximise the sales of clothes. However, she is also influenced by the potential for the land on which each of the shop premises is located on to grow in capital value. In late 2019, Nikki decides to develop one of the shop premises, because real estate in the area which it is located on had appreciated markedly in recent years. This involved Nikki obtaining a building approval from the local council, demolishing the shop, and building a 6 storey apartment building on the land. As Nikki did not know much about building, this consisted of contracting a major builder to be in charge of the process of building the apartment. These apartments are sold individually to the public through a leading real estate agent.

Ignoring Capital Gains Tax, discuss whether the sales proceeds from the apartments generate ordinary income.

The answer needs approximately 400 words.

Thanks

Exercise 16-11 (Part Level Submission)

The Polishing Department of Major Company has the following production and manufacturing cost data for September. Materials are entered at the beginning of the process.

Production: Beginning inventory 1,730 units that are 100% complete as to materials and 30% complete as to conversion costs; units started during the period are 46,900; ending inventory of 7,700 units 10% complete as to conversion costs.

Manufacturing costs: Beginning inventory costs, comprised of $22,100 of materials and $38,332 of conversion costs; materials costs added in Polishing during the month, $220,077; labor and overhead applied in Polishing during the month, $127,100 and $258,240, respectively.

a. Compute the equivalent units of production for materials and conversion costs for the month of September.

The equivalent units of production

Materials:_________

Conversion Costs:_________

B.Compute the unit costs for materials and conversion costs for the month.

Cost per equivalent unit of material :

C.Determine the costs to be assigned to the units transferred out and in process.

Cost of units transferred out:

Our accounting firm has won the engagement to be the new federal income tax consultant for a fortune 500 company. In the course of preparing the federal income tax returns for its tax year ending December 31, 2017, we reviewed the company's federal income tax returns for recent years. Our review discovered a large error in the company's computation of its domestic production activities deduction. The error is the result of misunderstanding the law, and was repeated on all of the recent returns. We have discussed the matter briefly and informally with the client, who has indicated that they would rather not file amended returns correcting the error. The client has also indicated that it would like a written analysis of the issue, including the chances of the issue being found by the IRS on audit and of the client prevailing on the matter if it winds up in court. To prepare for the next meeting with the client on this matter, we need to determine:

• Under the IRS rules applicable to tax practitioners, what are our ethical obligations to the client and to the IRS with regard to these mistakes, the analysis requested by the client and our advice to the client?
• Under the AICPA's standards, what are our ethical obligations to the client and to the IRS with regard to these mistakes, the analysis requested by the client and our advice to the client?

On pages 6-15 and 6-16 (Section 6-3b), the text explains that taxpayers are not allowed a business deduction for political contributions or for expenses incurred for lobbying activities.

• How does the IRS define what is a “political contribution” that cannot be deducted? Is the disallowance limited to outright gifts, or does it extend to less direct methods of providing funds to a candidate or party? If the latter, please explain the circumstances in which the disallowance applies to something that is not an outright gift.
• How does the IRS define what is “lobbying,” so that a taxpayer may determine what expenses are not deductible as lobbying expenses?
• Many not-for-profit organizations are engaged in lobbying, but still qualify to receive deductible charitable contributions. Does this activity affect an individual’s ability to claim a charitable deduction for contributions to an otherwise qualified organization? If so, in what circumstances, and how is the deduction affected?

On page 16-12, the text states that corporations (other than S corporations) are generally prohibited from using the cash method of accounting, but that there is an exception for “qualified personal service corporations.” The text states that a qualified personal service corporation is one that performs services in the fields of “health, law, engineering, architecture, accounting, actuarial science, performing arts, or consulting” and whose employees own substantially all of the stock of the corporation.

• Are there any other fields in which a qualified personal service corporation may provide services? If so, please list them.
• What is the test for determining if a qualified personal service corporation meets the stock ownership requirement? Describe in detail.
• What are the consequences of a corporation failing to meet the criteria as a qualified personal service corporation for a taxable year?

1. Given the information below about Thomas Corporation, what was the amount of dividends the company paid in the current period?

2. The ending Retained Earnings balance of Boomer Inc. decreased by $1.9 million from the beginning of the year. The company declared a dividend of $4.7 million during the year. What was the net income for the year?

3. When a company pays utilities of $1,710 in cash, the transaction is recorded as:

4. When a company pays $2,100 dividends to its stockholders, the transaction should be recorded as:

5. A company received a bill for newspaper advertising services, $460. The bill will be paid in 10 days. How would the transaction be recorded today?

6. On March 3, Cobra Inc. purchased a desk for $350 on account. On March 22, Cobra purchased another desk for $415 also on account, and then on March 24, Cobra paid $470 on account. At the end of March, what amount should Cobra report for desks (assuming these two desks were the only desks they had)?

7.

Use the following information to prepare a trial balance.

8. At the beginning of December, Global Corporation had $1,800 in supplies on hand. During the month, supplies purchased amounted to $3,000, but by the end of the month the supplies balance was only $1,400. What is the appropriate month-end adjusting entry?

9.

The following table contains financial information for Trumpeter Inc. before closing entries:

What is Trumpeter's net income?