Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.55 (given its target capital structure). Vandell has $8.71 million in debt that trades at par and pays an 7.7% interest rate. Vandell’s free cash flow (FCF0) is $1 million per year and is expected to grow at a constant rate of 5% a year. Both Vandell and Hastings pay a 40% combined federal and state tax rate. The risk-free rate of interest is 3% and the market risk premium is 7%. Hastings Corporation estimates that if it acquires Vandell Corporation, synergies will cause Vandell’s free cash flows to be $2.3 million, $3.0 million, $3.4 million, and $3.73 million at Years 1 through 4, respectively, after which the free cash flows will grow at a constant 5% rate. Hastings plans to assume Vandell’s $8.71 million in debt (which has an 7.7% interest rate) and raise additional debt financing at the time of the acquisition. Hastings estimates that interest payments will be $1.5 million each year for Years 1, 2, and 3. After Year 3, a target capital structure of 30% debt will be maintained. Interest at Year 4 will be $1.440 million, after which the interest and the tax shield will grow at 5%.

Indicate the range of possible prices that Hastings could bid for each share of Vandell common stock in an acquisition. Round your answers to the nearest cent. Do not round intermediate calculations. The bid for each share should range between $ per share and $ per share.

Goodfellow & Perkins gained a new client, Brookwood Pines Hospital (BPH), a private, not-for-profit hospital. The fiscal year-end for Brookwood Pines is June 30. You are performing the audit for the 2023 fiscal year-end.

The healthcare industry can be very complicated, especially in the area of billing for services provided. BPH contracts with private physician groups who use the hospital facilities, equipment, and nursing staff to treat patients. The physicians in the private group are not employees of the hospital; they are simply using the hospital facilities to treat patients. For example, a group of urologists have their own practice, separate from the hospital, where they treat patients. If one of the patients needs a surgical procedure that must be done at a hospital, then the attending urologist will approve the paperwork required to admit the patient to BPH. BPH offers inducements to the urologists so they will refer patients to BPH rather than a competing hospital. One of the inducements BPH offers is free office space in the hospital for the doctors to use when they are treating patients in the hospital.

After the doctor and hospital services are provided to the patient, the patient and/or the patient’s insurance company is billed. The doctor will bill for the services he or she provided, and the hospital will bill for the use of hospital facilities and staff. Doctors and hospitals bill using a coding system that is standardized across the healthcare industry and consists of three main code sets: ICD, CPT, and HCPCS. Using a coding system is more efficient and data-friendly compared to writing a narrative about the procedures performed. However, the coding system is very complex, with thousands of different codes for medical procedures and diagnoses. To complicate matters even more, for patients who are covered by government-sponsored Medicare or Medicaid, doctors and hospitals must adhere to complicated government regulations surrounding billings to Medicare and Medicaid.

As healthcare costs continue to rise each year, BPH administrators struggle to maintain consistent profitability. They look for ways to keep costs low and also to collect from patients and insurance companies as quickly as possible. In addition, BPH must have a strong risk management team to handle unique situations that may occur in hospitals such as malpractice lawsuits and periodic inspections by the state department of health and hospitals. Negative publicity for BPH could lead to decreased revenues if physicians decide to contract with a competing hospital.

You are completing the planning of the audit of accounts payable and payments system. A prenumbered voucher is used to record all payables. An IT application control performs the following procedures:

Given the information you have collected above about internal controls in the purchases process:

1.Evaluation: Evaluate the quality of internal controls for each assertion related to purchase transactions.

2. Analysis: For assertions where internal controls are determined to be strong, design appropriate tests of controls to test the assertion. You may assume that IT general controls have previously been tested and found effective.

3 Analysis and evaluation: For assertions where internal controls are weak, prepare a recommendation to management identifying the weakness, the risk of misstatement associated with the weakness, and a recommended control to correct the weaknesses.

The following business transactions were completed by Rialto Theatre Corporation from January 1 to 31, 2019.

1. Received and deposited in a bank account $500,000 for capital stock.
2. Purchased the Twin City Drive-In Theatre for $1,000,000, allocated as follows: land $300,000; buildings $375,000; equipment $325,000. Paid $400,000 in cash and gave a mortgage note for the remainder.
3. Entered into a contract for the operation of the refreshment stand concession at a rental of 10% of the concessionaire’s sales, with a guaranteed minimum of $5,000 a month, payable in advance. Received cash of $5,000 as the advance payment for January.
4. Paid premiums for property and casualty insurance policies, $30,000.
5. Purchased supplies, $7,500 and equipment, $14,500, on account.
6. Paid for January billboard and newspaper advertising, $6,500.
7. Cash received from admission for the first week, $34,000.
8. Paid miscellaneous expense, $2,200.
1. Paid semimonthly wages, $24,000.
10. Cash received for admission for the second week, $36,000.
11. Paid miscellaneous expense, $1,750.
50. Paid cash to creditors on account, $20,900.
1000. Cash received for admissions for the third week, $41,500.
14. Purchased supplies for cash, $1,700.
15. Paid for advertising leaflets for June, $1,500.
16. Recorded invoice of $45,000 for rental of film for January. Payment is due on February.
17. Paid electricity and water bills, $6,000.
18. Paid semimonthly wages, $24,500.
19. Cash received from admissions for the fourth week of the month, $37,000.
20. Recorded additional amount owed by the concessionaire for the month of January; sales for the month totaled $55,000. Rental charges in excess of the advance payment of $5,000 are not due and payable until February.

Prepare the financial statements (including the trial balance) and calculate the Acid Test Ratio, the Assets Turnover Ratio and the Return on Equity for Rialto Theatre Company for January 2019.

A firm has been experiencing low profitability in recent years. Perform an analysis of the firm's financial position using the DuPont equation. The firm has no lease payments but has a $1 million sinking fund payment on its debt. The most recent industry average ratios and the firm's financial statements are as follows:

^aCalculation is based on a 365-day year.

1. Calculate the following ratios. Do not round intermediate calculations. Round your answers to two decimal places.

   	Firm	Industry Average
   Current ratio	x	4.30x
   Debt to total capital	%	18.23%
   Times interest earned	x	5.57x
   EBITDA coverage	x	8.66x
   Inventory turnover	x	9.42x
   Days sales outstanding	days	31.46 days
   Fixed assets turnover	x	6.14x
   Total assets turnover	x	2.90x
   Profit margin	%	3.28%
   Return on total assets	%	10.42%
   Return on common equity	%	15.03%
   Return on invested capital	%	13.79%

2. Construct a DuPont equation for the firm and the industry. Do not round intermediate calculations. Round your answers to two decimal places.

   	Firm	Industry
   Profit margin	%	3.28%
   Total assets turnover	x	2.90x
   Equity multiplier	x	x

3. Do the balance sheet accounts or the income statement figures seem to be primarily responsible for the low profits?
   -Select-IIIIIIIVVItem 17
   1. Analysis of the extended Du Pont equation and the set of ratios shows that the turnover ratio of sales to assets is quite low; however, its profit margin compares favorably with the industry average. Either sales should be lower given the present level of assets, or the firm is carrying less assets than it needs to support its sales.
   2. Analysis of the extended Du Pont equation and the set of ratios shows that most of the Asset Management ratios are below the averages. Either assets should be higher given the present level of sales, or the firm is carrying less assets than it needs to support its sales.
   3. The low ROE for the firm is due to the fact that the firm is utilizing more debt than the average firm in the industry and the low ROA is mainly a result of an excess investment in assets.
   4. The low ROE for the firm is due to the fact that the firm is utilizing less debt than the average firm in the industry and the low ROA is mainly a result of an lower than average investment in assets.
   5. Analysis of the extended Du Pont equation and the set of ratios shows that the turnover ratio of sales to assets is quite low; however, its profit margin compares favorably with the industry average. Either sales should be higher given the present level of assets, or the firm is carrying more assets than it needs to support its sales.
      
4. Which specific accounts seem to be most out of line relative to other firms in the industry?
   -Select-IIIIIIIVVItem 18
   1. The accounts which seem to be most out of line include the following ratios: Inventory Turnover, Days Sales Outstanding, Fixed Asset Turnover, Profit Margin, and Return on Equity.
   2. The accounts which seem to be most out of line include the following ratios: Inventory Turnover, Days Sales Outstanding, Total Asset Turnover, Return on Assets, and Return on Equity.
   3. The accounts which seem to be most out of line include the following ratios: Current, EBITDA Coverage, Inventory Turnover, Days Sales Outstanding, and Return on Equity.
   4. The accounts which seem to be most out of line include the following ratios: Debt to Total Capital, Inventory Turnover, Total Asset Turnover, Return on Assets, and Profit Margin.
   5. The accounts which seem to be most out of line include the following ratios: Times Interest Earned, Total Asset Turnover, Profit Margin, Return on Assets, and Return on Equity.
      
5. If the firm had a pronounced seasonal sales pattern or if it grew rapidly during the year, how might that affect the validity of your ratio analysis?
   -Select-IIIIIIIVVItem 19
   1. If the firm had sharp seasonal sales patterns, or if it grew rapidly during the year, many ratios would most likely be distorted.
   2. It is more important to adjust the debt ratio than the inventory turnover ratio to account for any seasonal fluctuations.
   3. Seasonal sales patterns would most likely affect the profitability ratios, with little effect on asset management ratios. Rapid growth would not substantially affect your analysis.
   4. Rapid growth would most likely affect the coverage ratios, with little effect on asset management ratios. Seasonal sales patterns would not substantially affect your analysis.
   5. Seasonal sales patterns would most likely affect the liquidity ratios, with little effect on asset management ratios. Rapid growth would not substantially affect your analysis.
      
   
   How might you correct for such potential problems?
   -Select-IIIIIIIVVItem 20
   1. It is possible to correct for such problems by comparing the calculated ratios to the ratios of firms in the same industry group over an extended period.
   2. There is no need to correct for these potential problems since you are comparing the calculated ratios to the ratios of firms in the same industry group.
   3. It is possible to correct for such problems by insuring that all firms in the same industry group are using the same accounting techniques.
   4. It is possible to correct for such problems by using average rather than end-of-period financial statement information.
   5. It is possible to correct for such problems by comparing the calculated ratios to the ratios of firms in a different line of business.

A list of accounts for Maple Inc. at 12/31/2017 follows:

Accounts Receivable $2,359 Advertising Expense 4,510

Buildings and Equipment, Net 55,550

Capital Stock 50,000 Cash 590

Depreciation Expense 2,300 Dividends 6,000

Income Tax Expense 3,200 Income Tax Payable 3,200

Interest Receivable 100 Inventory: January 1, 2017 6,400

Inventory: December 31, 2017 7,500 Land 20,000

Net purchases 39,400 Retained Earnings, January 1, 2017 32,550

Salaries Expense 25,600 Salaries Payable 650

Net sales 83,584 Transportation-In 375

Utilities Expense 3,600

MAPLE INC. BALANCE SHEET AT DECEMBER 31, 2017

Assets Current assets:

Cash $ T $ T $ T $

Total current assets F

Property, plant, and equipment: T $ T $

Total property, plant, and equipment F

Total assets F Liabilities

Current liabilities: T $ T $

Total liabilities F Stockholders' Equity T $ T $

Total stockholders' equity F

Total liabilities and stockholders' equity F

what are some of the things that all three firms offer to motivate new employees

Record the following transactions for the month of January of a small finishing retailer, balance off all the accounts, and then extract a trial balance as at 31 January 20X8: 20X8

Jan 1 Started in business with £10,500 cash.

2 Put £9,000 of the cash into a bank account.

3 Bought goods for cash £550.

4 Bought goods on credit from: T Dry £800; F Hood £930; M Smith £160; G Low £510.

5 Bought stationery on credit from Buttons Ltd £89.

6 Sold goods on credit to: R Tong £170; L Fish £240; M Singh £326; A Tom £204.

8 Paid rent by cheque £220.

10 Bought fixtures on credit from Chiefs Ltd £610.

11 Paid salaries in cash £790.

14 Returned goods to: F Hood £30; M Smith £42.

15 Bought van by cheque £6,500.

16 Received loan from B Barclay by cheque £2,000.

18 Goods returned to us by: R Tong £5; M Singh £20.

21 Cash sales £145.

24 Sold goods on credit to: L Fish £130; A Tom £410; R Pleat £158.

26 We paid the following by cheque: F Hood £900; M Smith £118.

29 Received cheques from: R Pleat £158; L Fish £370.

30 Received a further loan from B Barclay by cash £500.

30 Received £614 cash from A Tom.

Nash Company manufactures equipment. Nash’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Nash has the following arrangement with Winkerbean Inc.

Nash delivers the equipment on June 1, 2020, and completes the installation of the equipment on September 30, 2020. The equipment has a useful life of 10 years. Assume that the equipment and the installation are two distinct performance obligations which should be accounted for separately.

Assuming Nash does not have market data with which to determine the standalone selling price of the installation services. As a result, an expected cost plus margin approach is used. The cost of installation is $39,200; Nash prices these services with a 25% margin relative to cost.

(a)

How should the transaction price of $1,040,000 be allocated among the service obligations? (Do not round intermediate calculations. Round final answers to 0 decimal places.)

(b)

Prepare the journal entries for Nash for this revenue arrangement on June 1, 2020, assuming Nash receives payment when installation is completed. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Pitman Company is a small editorial services company owned and operated by Jan Pitman. On October 31, 2019 the end of the current year, Pitman Company’s accounting clerk prepared the following unadjusted trial balance:

Pitman Company

UNADJUSTED TRIAL BALANCE

October 31, 2019

The data needed to determine year-end adjustments are as follows:

1/ John Wiggins is considering the purchase of a small restaurant. The purchase price listed by the seller is $850,000. John has used past financial information to estimate that the net cash flows (cash inflows less cash outflows) generated by the restaurant would be as follows: (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.) Years Amount 1-6 $ 85,000 7 75,000 8 65,000 9 55,000 10 45,000 If purchased, the restaurant would be held for 10 years and then sold for an estimated $750,000. Required: Determine the present value, assuming that John desires a 10% rate of return on this investment. (Assume that all cash flows occur at the end of the year.) (Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.)

2/ On January 4, 2018, Runyan Bakery paid $326 million for 10 million shares of Lavery Labeling Company common stock. The investment represents a 30% interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan received dividends of $3.50 per share on December 15, 2018, and Lavery reported net income of $160 million for the year ended December 31, 2018. The market value of Lavery's common stock at December 31, 2018, was $30 per share. On the purchase date, the book value of Lavery's net assets was $810 million and:

1. The fair value of Lavery's depreciable assets, with an average remaining useful life of four years, exceeded their book value by $40 million.
2. The remainder of the excess of the cost of the investment over the book value of net assets purchased was attributable to goodwill.

Required:
1. Prepare all appropriate journal entries related to the investment during 2018, assuming Runyan accounts for this investment by the equity method.
2. Prepare the journal entries required by Runyan, assuming that the 10 million shares represent a 10% interest in the net assets of Lavery rather than a 30% interest.

there are two different question

Please make an Excel Document for the listed information.

Annual Salary: $35,404.96
Monthly Salary: $2,950.41

Annual 10% (Savings): $3,540.49

Monthly Amount (Savings): $295.04

Monthly Payments:

Apartment - $850

Electricity - $47.08

Internet - $49.50

Phone - $98.88

Cable - $100.05

Student Loan - $710.86

Gym - $53.63

Netflix - $10.79

Spotify - $10.12

Food, Gas, Etc. - $350

New Car - $399.98

Insurance - $303.96

Amount Spent Monthly: $2,984.85

Amount Spent Annually: $35,818.20

On 11/1/X1 JacobCo Inc. hired an external engineering firm to design a new production line to produce a new fishing lure product line. The design of the new production line was completed on 11/28/X1 and JacobCo. Inc. received an invoice from the engineering firm in amount of $225,000. Construction started on a new production line on 12/8/X1 and was completed on 12/31/X1. The total construction cost of the new production line was $895,000. Interest expense from 11/1/X1 when the project was started to 12/31/X1 when it was completed amounted to $43,000 in total. Of that total interest expense $4,200 was attributable to the new production line.

The production line had an estimated engineering physical life of eight years. It is estimated that the production line could be scrapped and have a salvage value of approximately $30,000 at the end of that time.

The marketing department estimated that the new fishing lure product line would provide revenues to JacobCo. Inc. for the next five years. At the end of that time period the fishing lure product line will be discontinued and the production line will be scrapped and will sold for $10,000. The marketing department also estimates that the total number of fishing lures that will be sold over the next five years will be 500,000 units. The production line started into operation on 1/1/X2.

Required: Calculate depreciation for 12/31/X2 and 12/31/X3 and make the required journal entries using :

A. Straight line depreciation.

B. 200% double declining balance.

C. Units of Production assuming that 102,500 lures were produced in the year ending 12/31/X2 and 91,000 lures were produced in the year ending 12/31/X3.

Cannington Inc. designs, manufactures, and markets personal computers and related software. Cannington also manufactures and distributes music players (cPod), mobile phones (cPhone), and smartwatches (Cannington Watch) along with related accessories and services, including online distribution of third-party music, videos, and applications. The following information was taken from a recent annual report of Cannington:

a. Compute the book value of the fixed assets for the current year and the preceding year.

A comparison of the book values of the current and preceding years indicates that they  . A comparison of the total cost and accumulated depreciation reveals that Cannington purchased $fill in the blank 4 million of additional fixed assets, which was offset by the additional depreciation expense of $fill in the blank 5 million taken during the current year.

b. Would you normally expect Cannington’s book value of fixed assets to increase or decrease during the year?

Shadee Corp. expects to sell 600 sun visors in May and 800 in June. Each visor sells for $18. Shadee’s beginning and ending finished goods inventories for May are 75 and 50 units, respectively. Ending finished goods inventory for June will be 60 units.

3.

value:
3.33 points

Required information

Required:
1. Determine Shadee's budgeted total sales for May and June.

  

2. Determine Shadee's budgeted production in units for May and June.

Hints

References

eBook & Resources

Hint #1

Check my work

4.

value:
3.33 points

Required information

Each visor requires a total of $4.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $1.50 each. Shadee wants to have 30 closures on hand on May 1, 20 closures on May 31, and 25 closures on June 30. Additionally, Shadee’s fixed manufacturing overhead is $1,000 per month, and variable manufacturing overhead is $1.25 per unit produced.         


Required:
1. Determine Shadee's budgeted cost of closures purchased for May and June. (Round your answers to 2 decimal places.)

             

2. Determine Shadee's budget manufacturing overhead for May and June. (Do not round your intermediate calculations. Round your answers to 2 decimal places.)

Hints

References

eBook & Resources

Hint #1

Check my work

5.

value:
3.33 points

Required information

Suppose that each visor takes 0.30 direct labor hours to produce and Shadee pays its workers $9 per hour.        

Required:
Determine Shadee's budgeted direct labor cost for May and June.

After establishing their company’s fiscal year-end to be October 31, Natalie and Curtis began operating Cookie & Coffee Creations Inc. on November 1, 2018. The company had the following selected transactions during its first fiscal year of operations.

Jan.    1 Issued an additional 800 preferred shares to Natalie’s brother for $4,000 cash.

June. 30 Repurchased 750 shares issued to the lawyer, for $500 cash. The lawyer had decided to retire and wanted to liquidate all of her assets.

Oct.   15 The company had a very successful first year of operations and as a result declared dividends of $28,000, payable November 15, 2019. (Indicate the amounts payable to the preferred stockholders and to the common stockholders.)

Oct.   31 The company earned revenues of $472,500 and incurred expenses of $416,500 (including the $750 legal expense from November 1 but excluding income tax). Record income tax expense, assuming the company has a 20% income tax rate.

Instructions:

(a) Prepare the journal entries to record each of the above transactions.

(b) Prepare all of the closing entries required on October 31, 2019.

(c) Prepare the retained earnings statement for the year ended October 31, 2019.

(d) Prepare the stockholders’ equity section of the balance sheet as of October 31, 2019.