ACC 101

After graduating from Phoenix College with the most valuable degree in Accounting,

Michelle and Mary join together to form a new partnership named The Vintage Audio Company

(VAC). They sell two items to a specialty market – 8 Track Tapes (8TT), and Cassette Tapes

(CT). They use a LIFO system of inventory. The partnership operating agreement states that each

partner will receive a monthly distribution of $1,000, then commissions for their own sales, then

12% APR return on their beginning equity, and then split the remaining profit 60% for Michelle

/40% for Mary (in this order). The monthly distribution and commissions are taken during the

month as a draw and the journal entries have already been made at the time of payment.

During the month, VAC received a letter from the attorney of Jenny (one of their customers). The letter informed VAC that Jenny had declared bankruptcy and will not be paying the outstanding

balance of her account ($300).

Another month is finally over!! Time to “close the books”. Your assignment in that process is to

create the first two required financial statements for the previous month. To accomplish this

assignment, you will use the provided information to calculate the following:

1. Create the Income Statement in the proper format, including net sales, COGS, gross profit,

expenses and net income.

2. Create a Statement of Owners Equity

3. Provide an ending inventory schedule (schedule should include in good order, details by

transaction)

4. Provide the Net Book Value for the equipment

5. Provide only the journal entries for the following:

a. Income allocation between partners

b. Record the monthly bad debt expense

c. Record the monthly depreciation expense

d. Recognize the bad debt write-off for Jenny

Provided information:

Beginning Inventory Schedule (listed in the order they were purchased):

Beginning Inventory 8TT

Units        Cost          Amount

130          $5.00         $650.00

135          $5.20          $702.00

156           $5.50        $858.00

421                               $2,210.00

Beginning Inventory CT

Units       Cost            Amount

140         $7.00           $980.00

160          $7.50            $1,200.00

256         $8.00             $2,048.00

556                                $4,228.00

? You estimate that VAC will write off 2% of their sales in bad debt.

? Outbound freight to customers is calculated at $0.50 per unit sold.

? Shipping supplies (boxes, tape, etc.) are calculated at $0.20 per unit sold.

? Commission expense is 10% of net sales. For the previous month Michelle sold 60% of the

product. Mary sold the rest.

? Office supplies were $500 for the month.

? VAC is depreciating their packaging equipment on a straight-line basis. The equipment

was purchased two years ago on Jan 1. It cost $46,000 and has a useful life of 7 years, with

a salvage value estimated at $4,000.

Inventory Purchases during the month:

Apr 1 Purchased 50 8TT @ $5.00 each

Paid inbound freight of $25 for Apr 1 purchase

Apr 5 Purchased 50 CT @ $8.00 each

Apr 8 Purchased 50 8TT @ $5.00 each

Paid inbound freight of $25 for Apr 8 purchase

Apr 10 Purchased 50 CT @ $8.00 each

Apr 12 Purchased 50 CT @ $8.00 each

Apr 13 Returned 40 CT found to be defective. Purchase price was $7.00 each

Apr 17 Purchased 50 8TT @ $5.00 each

Paid inbound freight of $25 for Apr 17 purchase

Apr 20 Purchased 50 CT @ $8.00 each

Apr 24 Purchased 100 8TT @ $5.00 each

Paid freight bill of $50.00 for Apr 24

Apr 27 Purchased 75 CT @ $8.00 each

Apr 28 Purchased 75 8TT @ $5.50 each

Paid freight bill of $37.50 for Apr 28 purchases

Apr 29 Purchased 150 CT @ $8.20 each

Apr 30 Returned 20 CT found to be defective. Purchase price was $8 each

Credit Sales during the month:

Apr 3 Sold 65 8TT @ $10 each

Apr 3 Sold 75 CT @ $13 each

Apr 9 Sold 125 8TT @ $10 each

Apr 9 Sold 155 CT @ $13 each

Apr 12 Sold 75 8TT @ $10 each

Apr 13 Sold 196 CT @ $13 each

Apr 18 Sold 120 8TT @ $10 each

Apr 18 Sold 180 CT @ $13 each

Apr 23 Sold 56 8TT @ $10 each

Apr 23 Sold 75 CT @ $13 each

Apr 27 Sold 140 8TT @ $10 each

Apr 28 Sold 55 CT @ $13 each

Apr 30 Sold 130 8TT @ $10 each

Apr 30 Sold 140 CT @ $13 each

Beg. Capital- April 1^st

Michelle: $10,000.00

Mary: $5,000.00

Total: $15,000.00

ACC 101

Ending Inventory $502

Net Income $5,266.14

Total Ending Capital $16,416.34

Ultimate frisbee players are so poor they don’t own coins. So, team captains decide which team will play offense first by flipping frisbees before the start of the game. Rather than flip one frisbee and call a side, each team captain flips a frisbee and one captain calls whether the two frisbees will land on the same side, or on different sides. Presumably, they do this instead of just flipping one frisbee because a frisbee is not obviously a fair coin - the probability of one side seems likely to be different from the probability of the other side.

1. Suppose you flip two fair coins. What is the probability they show different sides?
2. Suppose two captains flip frisbees. Assume the probability that a frisbee lands convex side up is pp. Compute the probability (in terms of pp) that the two frisbees match.
3. Make a graph of the probability of a match in terms of pp.
4. One Reddit user flipped a frisbee 800 times and found that in practice, the convex side lands up 45% of the time. When captains flip, what is the probability of “same”? What is the probability of “different”?
5. What advice would you give to an ultimate frisbee team captain?
6. Is the two frisbee flip better than a single frisbee flip for deciding the offense?

Phase One: Alarm Reaction (reactions/results occur within minutes and hours--people can die within this stage if the stressor is extreme)
Phase Two: Stage of Resistance (when you still feel the physiological response in your body over a period of days, weeks and months, even years if you keep reliving the event)
Phase Three: Stage of Exhaustion (death occurs after long-time exposure to the stress... often times you don't even feel physiological signs anymore because your body is used to it)

1. Several months ago you witnessed a person falling from a building and still can’t sleep at night. You grind your teeth during the day. You can still feel your heart racing.

2.You suffer a stroke a year after retiring from your 30 year stressful job as an air traffic controller.

3. A deer runs in front of your car and you stop in the nick of time.

4. A child is burned over half of his body and although doctors try valiantly to save him, he dies five hours after his arrival to the hospital.

5. You have been in drama club for two years. Each time you think about going on stage, you get all sorts of physiological reactions as your stomach churns, your muscles get tight and you get headaches.

6. After caring for his ailing wife for over eight years, a man dies of a heart attack a month after his wife’s passing.

7. A man dies in his yard of heat stroke after shoveling a trench in 90 degree heat.

8. Your current college load of biology, history and English 101 are taking its toll on you. You have difficulty falling asleep and you get frequent headaches. You can't seem to shake this darn cold that you caught.

Say you observe the premiums of stock call options as follows,

what would be the arbitrage trading strategy?

A. Long one 50-strike call, short two 55-strike call, long one 60-strike call
B. Long two 50-strike call, short one 55-strike call, long two 60-strike call
C. Short one 50-strike call, short one 55-strike call, long two stocks
D. Short one 50-strike call, long two 55-strike call, short one 60-strike call

For each of the questions below, a histogram is described. Indicate in each case whether, in view of the Central Limit Theorem, you can be confident that the histogram would look like approximately a bell-shaped (normal) curve, and give a brief explanation why (one sentence is probably sufficient).

1. The price of one gallon of gasoline at a particular gas station is recorded every day of the year, and the 365 values are plotted in a histogram.

2. Two hundred students in a statistics class each flip a coin 40 times and record the number of heads. The numbers of heads are plotted in a histogram.

3. Two hundred students in a statistics each roll a die 60 times and record the sum of the numbers they got on the 60 rolls. They make a histogram of the 200 sums.

4. One thousand randomly chosen people report their annual salaries, and these salaries are plotted in a histogram.

5. The day before an election, fifty different polling organizations each sample 2000 people and record the percentage who say they will vote for the Democratic candidate. The 50 values are plotted in a histogram.

6. The fifty polling organizations also record the average age of the 2000 people in their sample, and the 50 averages are plotted in a histogram.

7. One hundred batteries are tested, and the lifetimes of the batteries are plotted in a histogram.

*Stock B has a two-for-one stock split in year 3.

Calculate the price-weighted index and the value-weighted index.

Calculate the percentage change from year 2 to year 3 for both indexes.

PPS=Price per share. S/O= Shares outstanding

Each day in April, you have an independent 1/4 chance of deciding to take a 6am run.

1. (a) What is the probability you go on exactly 12 runs in the month of April (which has

   30 days)?

2. (b) What is the expected number of days you go running during April?

3. (c) What is the probability that you go running at least once during April 1–7?

4. (d) What is the probability that that your first run of the month occurs on April 5?

5. (e) What is the probability that your first run of the month occurs on or before April 20?

Choose an article published in the last two weeks in one of these three resources (Wall Street Journal, Business Week, Economist). Discuss how the article relates to one or more of the Ten Basic Principles of Economics: "People Face Trade-offs" is what we will use. please be no less then 2-3 paragraphs and I will rate it well