Neustadt's Source of Presidential Power:
After reviewing Neustadt's ideas, apply them to the role of a CEO. What lessons can the CEO learn from reading Neustadt clearly? Illustrate specifically how a CEO could implement Neustadt's principles to help the firm fulfill its strategy.

1.) On June 1, 2020, Hanes Company purchased 10 computers with an invoice price of $50,000. Other costs incurred were sales tax $2,100, Freight $300, installation of $2,300, testing of $300, prepaid insurance to cover the computers; $3,600. The computers are estimated to have a 5-year life and $5,000 salvage value.

Instructions:

1. Find the cost of new computers. ___________________________

2. What is depreciation for 2020 and 2021 if the company uses the double-declining balance method.

2020 ______________________________                                                           

2021 ______________________________                                                                

2.) A company purchased factory equipment for $700,000 on August 1, 2020. It is estimated that the equipment will have a $70,000 salvage value at the end of its estimated 5-year useful life. If the company uses the double-declining-balance method of depreciation, the amount of annual depreciation recorded for the second year after purchase would be. (Round to whole dollars if necessary)

3.) A factory machine was purchased for $375,000 on November 1, 2021. It was estimated that it would have a $75,000 salvage value at the end of its 5-year useful life. It was also estimated that the machine would be run 40,000 hours in the 5 years. The company ran the machine for 4,000 actual hours in 2021. If the company uses the units-of-activity method of depreciation, the amount of depreciation expense for 2021 would be.

What is McCormick & Company current SWOT Analysis in 2020

Towing Company manufactures and sells a single product for $40 per unit.
Variable costs are $30 per unit and fixed costs total $168,000. During
2019, the company sold 26,500 units of this product to customers. In
order to improve profitability, the president of Towing Company believes
the following changes should be made in 2020:

1. decrease the selling price of the product by 10%

2. automate a portion of the production process which will reduce
   variable costs by 5% per unit but will add an additional fixed
   cost of $16,310 per year

3. increase advertising by $49,420

Assume these changes are made. 
A) Calculate the number of units that Towing Company must sell in 2020 in order to earn a net income that is 20% greater than the net income earned in 2019.

B) Calculate the number of units that Towing Company must sell in 2020 in order to earn a target profit equal to 12% of sales.

Bikes-R-Us Company

The company sponsors a defined benefit plan for its 200 employees. On January 1, 2020, the company’s actuary provided the following information:

Accumulated other comprehensive loss (PSC) $240,000

Pension plan assets (fair value and market-related asset value) 450,000

Accumulated benefit obligation $480,000

Projected benefit obligation $520,000

The average remaining service period for the participating employees is 6 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $62,000; the projected benefit obligation was $620,000; fair value of pension assets was $515,000; the accumulated benefit obligation amounted to $520,000. The expected return on plan assets and the discount dfevrate on the projected benefit obligation were both 6%. The actual return on plan assets is $15,000. The company’s current year’s contribution to the pension plan amounted to $50,000. No benefits were paid during the year.

(a) Determine the components of pension expense that the company would recognize in 2020. (With only one year involved,you need not prepare a worksheet.)

1(b) Prepare the journal entry to record the pension expense and the company’s funding of the pension plan in 2020.

(c) Compute the amount of the 2020 increase/decrease in gains or losses and the amount to be amortized in 2020 and 2021.

(d) Indicate the pension amounts reported in the financial statement as of December 31, 2020.

Your company sells a product bundle that includes software and a 3 year service contract for $100,000, The company installed the software on July 1, 2020, and the client paid $50,000 cash. The balance is due on December 31, 2020. What if:

(a) the performance obligations are interdependent and cannot be separated out or sold separately.

(b) the performance obligations are not interdependent ( The service contract is sold separately for $25,000 and the software for $100,000.)

On January 1, 2020, Sheffield Company purchased 8% bonds having a maturity value of $240,000, for $260,219.71. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Sheffield Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category.

Jen and Larry’s Frozen Yogurt Company

     In 2019, Jennifer (Jen) Liu and Larry Mestas founded Jean and Larry’s Frozen Yogurt Company, which was based on the idea of applying the microbrew or microbatch strategy to the production and sale of frozen yogurt. Jen and Larry began producing small quantities of unique flavors and blends in limited editions. Revenues were $600,000 in 2019 and were estimated to be $1.2 million in 2020.

     Because Jen and Larry were selling premium frozen yogurt containing premium ingredients, each small cup of yogurt sold for $3, and the cost of producing the frozen yogurt averaged $1.50 per cup. Administrative expenses, including Jen and Larry’s salary and expenses for an accountant and two other administrative staff, were estimated at $180,000 in 2020. Marketing expenses, largely in the form of behind-the-counter workers, in-store posters, and advertising in local newspapers, were projected to be $200,000 in 2020.

     An investment in bricks and mortar was necessary to make and sell the yogurt. Initial specialty equipment and the renovation of an old warehouse building in lower downtown (known as LoDo) occurred at the beginning of 2019. Additional equipment needed to make the amount of yogurt forecasted to be sold in 2020 was purchased at the beginning of 2020. As a result, depreciation expenses were expected to be $50,000 in 2020. Interest expenses were estimated at $15,000 in 2020. The average tax rate was expected to be 25% of taxable income.

1. Refer to the Mini Case above involving Jen and Larry’s Frozen Yogurt Company.
   1. Calculate the dollar amount of NOPAT if Jen and Larry’s venture achieves the forecasted $1.2 million in sales in 2020. What would NOPAT be as a percent of sales?
   2. Calculate the NOPAT breakeven point for 2020 in terms of NOPAT breakeven revenues for Jen and Larry’s venture. How many cups of frozen yogurt would have to be sold to reach NOPAT breakeven?

LifeCycle Biotech Company plans to invest $100 million into a new facility. It plans to use $20 million from its reserves and sell bonds at an interest rate of 4 percent to the public to raise the remaining $80 million. At the same time the U.S. has a budget deficit and decides to sell U.S. bonds to the public for 5 percent.

a) Will LifeCycle Biotech Company make the investment?

• No

• Yes

b) The government is now in competition with LifeCycle Biotech Company for capital. The result is an example of

• an automatic stabilizer.

• a Keynesian approach.

• a transfer payment.

• crowding out.

pick from the multiple choice

Under the full goodwill method, a control premium is recognised when:

Fredericks Limited acquired the identifiable assets and liabilities of Nicole Limited for $134 000. The items acquired, stated at fair value, are: plant $72 000; inventories $40 000; accounts receivable $18 000; patents $10 000; accounts payable $16 000. The difference on acquisition is:

Xana Limited paid $110 000 for 60% of the shares in Yama Limited. At the date of acquisition Yama Limited had share capital of $100 000 and retained earnings of $36 000 and all of Yama Limited’s assets and liabilities were recorded at fair value, except for land that was recorded at an amount less than the fair value by $20 000. The company tax rate was 30%. The fair value of identifiable net assets acquired by Xana Limited amounted to: