There is a hotel in Imatra (Finland) which is very close to
Russian border. The
demand function of Finnish consumers for this hotel is Q = 1000 -
P. The demand
function of Russian consumers for this hotel would be Q = 1400 - P
if they had not
travel to Imatra, but they have to travel and cost of travelling is
200. MC of hotel is
200 for one visitor. Find the difference of profits with price
discrimination and without
price discrimination.
In: Economics
Cyclops Company has its own research department. However, the company purchases patents from time to time. The following is a summary of transactions involving patents now owned by the company.
Assume that the legal life of each patent is also its useful life.
Required:
Total amortization expense for the year ended December 31, 2020
these are all the information given.
In: Accounting
First Cup Ltd., a Canadian coffee retailer and roaster which operates more than 1,000 cafes in Canada, reported the following balances as at December 31, 2020:
7% Par $100 convertible bonds, issued at par $250,000
3,000 call options, each entitled to purchase 1 common shar
Cumulative Preferred shares, 36,000 convertible shares outstanding $960,000
Common shares, 112,500 shares issued and outstanding $2,880,000
Contributed surplus on repurchase of common shares $31,200
Retained earnings $1,032,000
First Cup Ltd. applies IFRS. The company also informed you details related to the following transactions during 2020:
a] On February 1, the company declared and distributed a 20% stock dividend for its common shareholders. The shares were being traded in the market at $30.
b] On March 1, it acquired 18,000 of its own common shares in the market at $30.00 per share and retired them on the same day.
c] On April 1, the company issued 17,500 common shares in exchange for plant and equipment assessed at $336,000.
d] On May 1, 40% of the call option holders exercised their options when the market price of the common share was $31. As these options were issued before stock dividends, options holders receive an increased number of shares considering a 20% stock dividends (i.e. adjust for stock dividend).
e] On May 15, the company declared a 3:1 stock split on common shares. The common shares were being traded at the adjusted market price of $32.00 per share
f] On August 1, the company issued share certificates for 3,708 common shares to subscribers who had applied to an earlier share subscription issue. These subscribers had paid for the shares they had subscribed at $34 per share.
g] On October 1, 20% of the bond holders submitted their bonds to the company for conversion into common shares. As the bonds were issued before stock dividends and stock split, the number of shares given to reward conversion need to be adjusted consequently.
h] No Dividends have been declared in the previous two years. Dividends for the current year were also not declared.
Additional Information
i] The cumulative preferred shares had been issued several years ago when the company was incorporated. Cumulative preferred shares carried a dividend rate of $2.10 per share and as at January 1, 2020, one preferred share could be converted into two common shares.
ii] The company reported earnings from operations of $1,847,790 for 2020. There were no discontinued items to report in 2020.
iii] The bonds had been issued at par in 2017. Assume No premium was charged for the conversion rights and debt was credited for the full amount received. Each $100 bond was convertible into 8 common shares.
Required:
Determine the weighted average number of shares for determining the basic earnings per share for 2020 using this template
|
Date |
# number of shares |
Ratio |
Restatement |
WACS |
|
1/1 |
||||
|
1/2 |
||||
|
1/3 |
||||
|
1/4 |
||||
|
1/5 |
||||
|
15/5 |
||||
|
1/8 |
||||
|
1/10 |
||||
|
Balance WACS= |
In: Accounting
New threat to AGOA benefits' by Kevin Lovell
SUNDAY, 02 OCTOBER 2016
SOURCE: ENCA / ANN (SOUTH AFRICA)
The United States poultry industry has warned that South Africa could once again lose its trade free access for many exports to the market if South African poultry and pork producers get a court injunction to block US chicken imports.
US Poultry and Egg Export Council (Usapeec) president James Sumner said that if the South African Poultry Association (Sapa) and SA Pork Producers Organisation (Sappo) won their court case “it probably would – and should – trigger another out-of-cycle review under Agoa”.
The African Growth and Opportunity Act (Agoa) is the US law which allows eligible African countries to export many products to the US duty-free. It has been particularly beneficial to South African automobile, wine, and fruit exporters.
But South Africa nearly lost its key Agoa benefits last year as a result of an “out-of-cycle” review triggered by US poultry, pork, and beef producers who complained that South Africa was violating Agoa by blocking imports of their products.
South Africa eventually negotiated its continued participation in Agoa by lifting 15-year-old anti-dumping duties for a quota of 65,000 tons of chicken parts a year and also lifted health restrictions which continued to block poultry, pork, and beef imports.
But Sapa and Sappo have now appealed the lifting of the health restrictions on imported US poultry and pork. Sappo CEO Simon Streicher has been quoted in South African media saying his organisation was not convinced the US was doing enough to prevent its pork bringing porcine reproductive and respiratory syndrome (PRRS) into the country.
Streicher told The Poultry Site that South Africa was one of only a few countries in the world where PRRS had been eliminated and Sappo was wary of allowing it back in. He said about 500kg of US pork shoulders had already been blocked since the concession was made because of PRRS concerns.
Sapa is appealing against concessions by the government concerning the standard salmonella protocol for testing imported products, because of the risk of people getting sick if contaminated poultry enters the country.
Sapa CEO Kevin Lovell said Sapa and Sappo’s appeals should not have a negative impact on the Agoa agreement, as it was not an attack on agreed quotas. “All we want is for the United States to follow the same protocols as any other country.”
However, Sumner was convinced that if Sapa and Sappo won their court appeals South Africa’s Agoa participation would once again be challenged. He also acknowledged that because of various problems, the US had so far only met about 10 percent of the 65,000 tons quota and was likely to fall far short of it by the end of the year.
Another major obstacle has been that two major supermarket chains, Pick ‘n Pay and Checkers, have decided not to import US poultry. Jim Wayt managing director of Intervision Foods, one of the US companies exporting poultry to SA, said he was convinced that this was because the supermarkets were trying to avoid public perception of health problems rather than because of any real health concerns.
“If we get a level playing field, rather than a Lovell playing field, we will be able to compete,” he quipped, punning on the name of Sapa CEO Kevin Lovell, who has been the chief opponent of US poultry imports.
Sumner also expressed confidence that the US would eventually be able to meet its quota once it had made the necessary contacts and got back into the market from which it had been excluded for 17 years.
The US could benefit from a possible imposition of tariffs on poultry imports from the European Union (EU), which now enter the South African market tariff-free under the EU-SA free trade agreement. Wayt said he was expecting the South African trade authorities to make a determination on this on 21 October. The protection which SAPA is seeking for what is says has been a surge of EU poultry imports is a 13.4 percent safeguard duty.
One of the major US complaints has been that it is not only competing with South African poultry producers but also with EU producers who had a huge price advantage
Sumner noted that even after the prohibitive anti-dumping duties on US poultry imports had been lifted for the 65,000 tons a year quota, US poultry producers were still paying normal duties of 37 percent versus zero for the EU.
“If South African poultry producers can’t compete with us after that duty, coming on top of our landed transport costs – South Africa is not next door to the US – then its not surprising chicken is so expensive in South Africa,” he said.
He also announced that the World Poultry Foundation would be coming to South Africa soon to discuss proposals for a programme to help and train disadvantaged South Africans to enter the poultry industry. Usapeec is funding that programme.
Assignment:
Use the AGOA case reported by Lovell (2016), above, to identify and discuss the most significant trade issues and their implications for economic growth and social welfare (on consumers and producers) in both countries concerned (RSA and US), given the rising protectionist sentiments in the US and the UK. In your economic discussion, use a combination of the economic theories and models listed below to identify and analyse the implications of a possible loss of the US’s AGOA benefits to South Africa – especially given the reported developments around meat products:
a. Production possibilities frontier; Trade gains and economic growth (relevant theories and models) (25%)
b. Government Intervention effects from instruments including import and exports (subsidies; tariffs (taxes), quotas, etc.) (25%)
c. Economic Welfare theories (Producer and Consumer Welfare models) (25%)
In: Economics
AGOA CASE STUDY
New threat to AGOA benefits' by Kevin Lovell
SUNDAY, 02 OCTOBER 2016
SOURCE: ENCA / ANN (SOUTH AFRICA)
The United States poultry industry has warned that South Africa could once again lose its trade free access for many exports to the market if South African poultry and pork producers get a court injunction to block US chicken imports.
US Poultry and Egg Export Council (Usapeec) president James Sumner said that if the South African Poultry Association (Sapa) and SA Pork Producers Organisation (Sappo) won their court case “it probably would – and should – trigger another out-of-cycle review under Agoa”.
The African Growth and Opportunity Act (Agoa) is the US law which allows eligible African countries to export many products to the US duty-free. It has been particularly beneficial to South African automobile, wine, and fruit exporters.
But South Africa nearly lost its key Agoa benefits last year as a result of an “out-of-cycle” review triggered by US poultry, pork, and beef producers who complained that South Africa was violating Agoa by blocking imports of their products.
South Africa eventually negotiated its continued participation in Agoa by lifting 15-year-old anti-dumping duties for a quota of 65,000 tons of chicken parts a year and also lifted health restrictions which continued to block poultry, pork, and beef imports.
But Sapa and Sappo have now appealed the lifting of the health restrictions on imported US poultry and pork. Sappo CEO Simon Streicher has been quoted in South African media saying his organisation was not convinced the US was doing enough to prevent its pork bringing porcine reproductive and respiratory syndrome (PRRS) into the country.
Streicher told The Poultry Site that South Africa was one of only a few countries in the world where PRRS had been eliminated and Sappo was wary of allowing it back in. He said about 500kg of US pork shoulders had already been blocked since the concession was made because of PRRS concerns.
Sapa is appealing against concessions by the government concerning the standard salmonella protocol for testing imported products, because of the risk of people getting sick if contaminated poultry enters the country.
Sapa CEO Kevin Lovell said Sapa and Sappo’s appeals should not have a negative impact on the Agoa agreement, as it was not an attack on agreed quotas. “All we want is for the United States to follow the same protocols as any other country.”
However, Sumner was convinced that if Sapa and Sappo won their court appeals South Africa’s Agoa participation would once again be challenged. He also acknowledged that because of various problems, the US had so far only met about 10 percent of the 65,000 tons quota and was likely to fall far short of it by the end of the year.
Another major obstacle has been that two major supermarket chains, Pick ‘n Pay and Checkers, have decided not to import US poultry. Jim Wayt managing director of Intervision Foods, one of the US companies exporting poultry to SA, said he was convinced that this was because the supermarkets were trying to avoid public perception of health problems rather than because of any real health concerns.
“If we get a level playing field, rather than a Lovell playing field, we will be able to compete,” he quipped, punning on the name of Sapa CEO Kevin Lovell, who has been the chief opponent of US poultry imports.
Sumner also expressed confidence that the US would eventually be able to meet its quota once it had made the necessary contacts and got back into the market from which it had been excluded for 17 years.
The US could benefit from a possible imposition of tariffs on poultry imports from the European Union (EU), which now enter the South African market tariff-free under the EU-SA free trade agreement. Wayt said he was expecting the South African trade authorities to make a determination on this on 21 October. The protection which SAPA is seeking for what is says has been a surge of EU poultry imports is a 13.4 percent safeguard duty.
One of the major US complaints has been that it is not only competing with South African poultry producers but also with EU producers who had a huge price advantage
Sumner noted that even after the prohibitive anti-dumping duties on US poultry imports had been lifted for the 65,000 tons a year quota, US poultry producers were still paying normal duties of 37 percent versus zero for the EU.
“If South African poultry producers can’t compete with us after that duty, coming on top of our landed transport costs – South Africa is not next door to the US – then its not surprising chicken is so expensive in South Africa,” he said.
He also announced that the World Poultry Foundation would be coming to South Africa soon to discuss proposals for a programme to help and train disadvantaged South Africans to enter the poultry industry. Usapeec is funding that programme.
Assignment:
Use the AGOA case reported by Lovell (2016), above, to identify and discuss the most significant trade issues and their implications for economic growth and social welfare (on consumers and producers) in both countries concerned (RSA and US), given the rising protectionist sentiments in the US and the UK. In your economic discussion, use a combination of the economic theories and models listed below to identify and analyse the implications of a possible loss of the US’s AGOA benefits to South Africa – especially given the reported developments around meat products:
a. Production possibilities frontier; Trade gains and economic growth (relevant theories and models) (25%)
b. Government Intervention effects from instruments including import and exports (subsidies; tariffs (taxes), quotas, etc.) (25%)
c. Economic Welfare theories (Producer and Consumer Welfare models) (25%)
In: Economics
A company reported the following accounts in its unadjusted trial balance at December 31, 2020: Dividends ................... $ 14,000 Income Tax Expense .......... $ 25,000 Salaries Expense ............ $ 31,000 Rental Revenue .............. $ 33,000 Cash ........................ $ 36,000 Supplies .................... $ 37,000 Cost of Goods Sold .......... $ 52,000 Unearned Revenue ............ $ 54,000 Accounts Receivable ......... $ 57,000 Land ........................ $ 69,000 Accounts Payable ............ $ 76,000 Trademark ................... $ 88,000 Inventory ................... $ 91,000 Retained Earnings ........... $ 95,000 (at January 1, 2020)Sales Revenue ............... $119,000 Common Stock ................ $123,000 The Company needs to record adjusting entries at December 31, 2020 related to the following three items: 1) A utility bill totaling $16,000 was received in late December. The Company expects to pay the bill in January, 2021. 2) A physical count revealed that supplies costing $15,000 were still on hand as of December 31, 2020. 3) The unearned revenue relates to a $54,000 payment received on July 1, 2020. The payment was from a customer who paid the company for services to be provided each month for 18 months, beginning on July 1, 2020. Calculate Company's total liabilities at December 31, 2020 afterthe appropriate adjusting entries have been recorded and posted.
In: Accounting
SolarTubeGen is a start-up company in the renewable energy sector. The founder of SolarTubeGen, Fritz Herzberg, has developed cutting-edge technology to convert the energy in the sun’s rays to electricity via a novel system of mirrors designed to focus the sun’s rays onto tubes containing a patented type of gas, which then heats and expands to drive turbines. Ramirez & Walker LLP has won the contract for the first audit of SolarTubeGen on the basis of its expertise in the energy sector. However, the lead partner, Mark Ramirez, recognizes the success of the audit is dependent on the correct assessment of the technology being used at SolarTubeGen. Mark specified in the successful audit bid documents that the audit will use an external specialist to help with valuation of the company’s assets.
Fritz Herzberg is very protective of his company’s intellectual property and is resistant to Mark’s first suggested specialist, Manfred Hamburg. Fritz believes that Manfred Hamburg is hostile toward him because they clashed when they both worked for a German company making photovoltaic cells in the 1990s. Fritz has suggested another specialist, Lily Beilherz, with whom he has had good working relations over the last 20 years.
Required
In: Accounting
Incorporated by the founder of the Tata Group,
Jamsetji Tata, the company opened its first hotel,
the Taj Mahal Palace, in Mumbai in 1903.
For over a century, The Taj Mahal Palace, Mumbai, has remained an
iconic flagship and has set a
benchmark for fine living with exquisite refinement, inventiveness
and warmth. Indian Hotels
Company Limited (IHCL) has a portfolio of 170 hotels, including 25
under development, in over
eighty locations in twelve countries spread across four
continents.
IHCL is amongst South Asia’s largest hospitality companies by
market capitalization and represents
a global hallmark of quality in hospitality.
The Tata Group owns hotels in India and all over the world and in
order to effectively control
its hotels systems the management have put the following in
place:
• Hotel room key cards
• Security alarm systems
• Inventory control
• Hotel management systems
• Financial controls
According to your understanding of organisational control explain
what is meant by the
following:
a) Planning, organising, coordination and controlling [25
marks]
b) Explain how the above control systems can be used to monitor,
measure, and evaluate
the Tata Group Hotel Systems? [25 marks]
c) Give five purposes of control systems used by TATA Hotels and
how staff are made
to contribute to their success? [25 marks]
d) Describe the steps in organisational control and explain why
corrective action is
important? [15 marks]
e) Give three financial ratios which can be used in Financial
controls and their use? (10
marks) [100 marks]
In: Accounting
Background
In this hypothetical scenario, you are the Chief Executive Officer (CEO), of a company, Island Ports Limited. Your business, is a global business, with shipping ports in all of the major English speaking Caribbean countries. On January 7, 2020, you signed a Heads of Agreement with the Government of The Bahamas to invest $120 million during Phase I to develop a cruise port on the island of New Providence. As you can appreciate, the signing and the commitment of your shareholders to this project, preceded any information available to your company and its shareholders with respect to the potential impact of the coronavirus, i.e. COVID-19.
Concessions granted to Island Ports (hypothetical scenario)
The following were the concessions granted to Island Ports during the signing of the Heads of Agreement:
Commitments from Island Ports to the Government and People of The Bahamas
In light of the concessions granted to Island Ports as listed above, the company has committed the following to the Government and people of The Bahamas:
The following is the outlook for The Bahamas, based on baseline data (as at 2019) taken from the Central Bank Quarterly Digest at www.centralbankbahamas.com and projections for 2020 based on these baseline numbers:
Table I: Key Metrics for The Bahamas
|
Key Metrics |
As at 2019 (Pre COVID-19) |
Impact – Projected 2020 |
|
National Debt as at December, 2019 ($mils.) |
$8,749 |
$10,413 |
|
Debt in Foreign Currency ($mils.) |
$2,618 |
$4,282 |
|
Foreign Reserves as at Feb., 2020 ($mils.) |
$2,001 |
$900 |
|
Gross Domestic Product (2019) ($mils.) |
$12,900 |
$10,900 |
|
National Debt as % of GDP |
67.8% |
95.5% |
|
Tourism Expenditure as at 2019 ($mils.)* |
$2,817 |
$1,665 |
|
Unemployment as at November, 2019 |
11.0% |
24.8% |
|
Government GFS Deficit ($mils.) |
($377.6) |
($1,664) |
You have just been appointed the Chief Operating Officer (COO) of Island Ports. You have over twenty years experienceadvising CEO’s on strategic decisions. In addition to your experience as an advisor on strategy, you are accomplished academically. You were a graduate of the University of TheBahamas and later pursued your Masters at Yale in Analytics and Strategy. Needless to say, there is high expectations from your office, in helping the company, Island Ports on the way forward.
Decision
Island Ports has to decide as to whether it wishes to move forward in September, 2020, with the start of construction of Phase I of the construction of the cruise port in New Providence. Island Ports investors are also reluctant to move forward in the current environment. The Government of The Bahamas is also applying pressure to Island Ports to get started with its construction, as this project will provide much needed jobs for the economy, at a time when jobs and incomes are really needed. The government has also reminded Island Ports of the generous concessions that were granted on the condition that the project gets started on time. While the Government of The Bahamas is applying pressure to Island Ports, the company has reminded the government that its project will provide tremendous benefits to the country, through its efforts and ingenuity.
As the COO, you are asked to advise the company on the way forward by way of answering the following questions:
APPENDIX
Key Metrics – The Bahamas
Assumptions and other notes:
Table I: Key Metrics
|
Key Metrics |
As at 2019 (Pre COVID-19) |
Impact – Projected 2020 |
|
National Debt as at December, 2019 ($mils.) |
$8,749 |
$10,413 |
|
Debt in Foreign Currency ($mils.) |
$2,618 |
$4,282 |
|
Foreign Reserves as at Feb., 2020 ($mils.) |
$2,001 |
$900 |
|
Gross Domestic Product (2019) ($mils.) |
$12,900 |
$10,900 |
|
National Debt as % of GDP |
67.8% |
95.5% |
|
Tourism Expenditure as at 2019 ($mils.)* |
$2,817 |
$1,665 |
|
Unemployment as at November, 2019 |
11.0% |
24.8% |
|
Government GFS Deficit ($mils.) |
($377.6) |
($1,664) |
The tourism expenditure of $1.665 billion does not take into account seasonal adjustments/variations, which may result in even a lower level of receipts from tourism.
In: Economics
"Business Law"
Dr. A quits her job at ABC University because she got a better job at XYZ University. Can ABC University get an injunction prohibiting her from teaching at XYZ University?
In: Operations Management