1. Using the information in this chapter, label each of the following statements true, false, or uncertain. Explain briefly.

a. The largest component of GDP is consumption.

b. Government spending, including transfers, was equal to 18.1% of GDP in 2014.

c. The propensity to consume has to be positive, but other- wise it can take on any positive value.

d. One factor in the 2009 recession was a drop in the value of the parameter c0.

e. Fiscal policy describes the choice of government spend- ing and taxes and is treated as exogenous in our goods market model.

f. The equilibrium condition for the goods market states that consumption equals output.

g. An increase of one unit in government spending leads to an increase of one unit in equilibrium output.

h. An increase in the propensity to consume leads to a de- crease in output.

2. Suppose that the economy is characterized by the following behavioral equations:

C = 160 + 0.6YD

I = 150 G = 150

T = 100

Solve for the following variables.

a. Equilibrium GDP (Y)

b. Disposable income (YD)

c. Consumption spending (C)

3. Use the economy described in Problem 2.

a. Solve for equilibrium output. Compute total demand. Is it equal to production? Explain.

b. AssumethatGisnowequalto110.Solveforequilibrium output. Compute total demand. Is it equal to production? Explain.

c. Assume that G is equal to110,so output is given by your an- swer to part b. Compute private plus public saving. Is the sum of private and public saving equal to investment? Explain.

The US economy has been experiencing an economic downturn since March. Based on the second quarter estimates released by the Bureau of Economic Research, lockdown orders across the country issued in March led to rapid shifts in business behavior and consumer spending, causing a 31.7 percent annual rate decline in the Gross Domestic Product (GDP). The full socioeconomic effects of the COVID-19 pandemic will take economists and public health experts several years to quantify. At this time, what we know is that the COVID-19 recession than past recessions in many ways. Briefly discuss three features that make the COVID-19 recession unusual when compared to past economic downturns.

Problem 23-1A

Cook Farm Supply Company manufactures and sells a pesticide called Snare. The following data are available for preparing budgets for Snare for the first 2 quarters of 2017.

1. Sales: quarter 1, 28,300 bags; quarter 2, 42,500 bags. Selling price is $61 per bag.
2. Direct materials: each bag of Snare requires 4 pounds of Gumm at a cost of $3.8 per pound and 6 pounds of Tarr at $1.75 per pound.
3. Desired inventory levels:

Type of Inventory
January 1
April 1
July 1
Snare (bags) 8,400 12,300 18,100
Gumm (pounds) 9,200 10,200 13,400
Tarr (pounds) 14,500 20,200 25,300

4. Direct labor: direct labor time is 15 minutes per bag at an hourly rate of $14 per hour.
5. Selling and administrative expenses are expected to be 15% of sales plus $176,000 per quarter.
6. Interest expense is $100,000.
7. Income taxes are expected to be 30% of income before income taxes.

Your assistant has prepared two budgets: (1) the manufacturing overhead budget shows expected costs to be 125% of direct labor cost, and (2) the direct materials budget for Tarr shows the cost of Tarr purchases to be $303,000 in quarter 1 and $425,500 in quarter 2.

(Note: Do not prepare the manufacturing overhead budget or the direct materials budget for Tarr.)

[Partially correct answer.] Your answer is partially correct. Try again.

Prepare the sales budget.

COOK FARM SUPPLY COMPANY
Sales Budget
[Entry field with correct answer]

June 30, 2017
For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
Quarter
Six
Months
1
2
Expected unit sales
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]
Unit selling price
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
Total sales
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]

Prepare the production budget.

COOK FARM SUPPLY COMPANY
Production Budget
[Entry field with correct answer]

For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
June 30, 2017
Quarter
Six
Months
1
2
[Entry field with correct answer]

Beginning Direct Materials
Total Required Units
Cost per Pound
Direct Materials per Unit
Beginning Finished Goods Units
Desired Ending Direct Materials
Desired Ending Finished Goods Units
Total Materials Required
Required Production Units
Direct Labor Cost per Hour
Expected Unit Sales
Direct Materials Purchases
Direct Labor Time per Unit
Total Cost of Direct Materials Purchases
Total Direct Labor Cost
Total Required Direct Labor Hours
Total Pounds Needed for Production
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Add
Less
:
[Entry field with correct answer]

Total Required Direct Labor Hours
Total Materials Required
Direct Labor Time per Unit
Total Pounds Needed for Production
Direct Materials Purchases
Expected Unit Sales
Total Required Units
Total Cost of Direct Materials Purchases
Beginning Direct Materials
Beginning Finished Goods Units
Direct Materials per Unit
Direct Labor Cost per Hour
Required Production Units
Desired Ending Finished Goods Units
Total Direct Labor Cost
Cost per Pound
Desired Ending Direct Materials
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Direct Materials Purchases
Desired Ending Direct Materials
Total Required Units
Expected Unit Sales
Desired Ending Finished Goods Units
Direct Labor Cost per Hour
Total Direct Labor Cost
Required Production Units
Direct Labor Time per Unit
Direct Materials per Unit
Total Cost of Direct Materials Purchases
Total Required Direct Labor Hours
Total Pounds Needed for Production
Total Materials Required
Beginning Direct Materials
Beginning Finished Goods Units
Cost per Pound
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Add
Less
:
[Entry field with correct answer]

Total Required Direct Labor Hours
Direct Labor Time per Unit
Total Pounds Needed for Production
Beginning Finished Goods Units
Cost per Pound
Total Required Units
Total Materials Required
Beginning Direct Materials
Direct Materials Purchases
Desired Ending Finished Goods Units
Desired Ending Direct Materials
Direct Materials per Unit
Direct Labor Cost per Hour
Expected Unit Sales
Required Production Units
Total Cost of Direct Materials Purchases
Total Direct Labor Cost
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Desired Ending Finished Goods Units
Beginning Finished Goods Units
Direct Materials per Unit
Total Materials Required
Total Cost of Direct Materials Purchases
Expected Unit Sales
Total Pounds Needed for Production
Total Required Direct Labor Hours
Total Required Units
Direct Labor Cost per Hour
Direct Labor Time per Unit
Required Production Units
Desired Ending Direct Materials
Direct Materials Purchases
Total Direct Labor Cost
Cost per Pound
Beginning Direct Materials
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]

LINK TO TEXT
LINK TO TEXT

[Partially correct answer.] Your answer is partially correct. Try again.

Prepare the direct materials budget. (Round Cost per pound answers to 2 decimal places, e.g. 52.70.)

COOK FARM SUPPLY COMPANY
Direct Materials Budget—Gumm
[Entry field with correct answer]

For the Six Months Ending June 30, 2017
For the Quarter Ending June 30, 2017
June 30, 2017
Quarter
Six
Months
1
2
[Entry field with correct answer]

Total Pounds Needed for Production
Total Required Direct Labor Hours
Direct Materials Purchases
Desired Ending Finished Goods Units
Desired Ending Direct Materials
Expected Unit Sales
Total Required Units
Total Direct Labor Cost
Direct Labor Cost per Hour
Units to be Produced
Total Cost of Direct Materials Purchases
Total Materials Required
Direct Labor Time per Unit
Beginning Direct Materials
Beginning Finished Goods Units
Cost per Pound
Direct Materials per Unit
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Total Pounds Needed for Production
Total Required Units
Total Materials Required
Direct Labor Time per Unit
Direct Materials per Unit
Total Direct Labor Cost
Cost per Pound
Beginning Direct Materials
Beginning Finished Goods Units
Desired Ending Direct Materials
Total Required Direct Labor Hours
Units to be Produced
Desired Ending Finished Goods Units
Direct Labor Cost per Hour
Direct Materials Purchases
Expected Unit Sales
Total Cost of Direct Materials Purchases
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Beginning Finished Goods Units
Total Cost of Direct Materials Purchases
Total Pounds Needed for Production
Desired Ending Direct Materials
Desired Ending Finished Goods Units
Total Required Units
Total Required Direct Labor Hours
Units to be Produced
Direct Labor Time per Unit
Total Materials Required
Beginning Direct Materials
Cost per Pound
Direct Labor Cost per Hour
Direct Materials per Unit
Direct Materials Purchases
Expected Unit Sales
Total Direct Labor Cost
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Add
Less
:
[Entry field with correct answer]

Direct Materials per Unit
Total Direct Labor Cost
Desired Ending Direct Materials
Total Required Direct Labor Hours
Direct Materials Purchases
Direct Labor Time per Unit
Beginning Direct Materials
Total Cost of Direct Materials Purchases
Total Required Units
Units to be Produced
Beginning Finished Goods Units
Total Materials Required
Cost per Pound
Direct Labor Cost per Hour
Expected Unit Sales
Total Pounds Needed for Production
Desired Ending Finished Goods Units
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Beginning Direct Materials
Direct Materials per Unit
Units to be Produced
Desired Ending Direct Materials
Direct Materials Purchases
Beginning Finished Goods Units
Total Cost of Direct Materials Purchases
Cost per Pound
Total Required Direct Labor Hours
Desired Ending Finished Goods Units
Total Materials Required
Expected Unit Sales
Total Direct Labor Cost
Direct Labor Cost per Hour
Total Pounds Needed for Production
Total Required Units
Direct Labor Time per Unit
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Add
Less
:
[Entry field with correct answer]

Total Pounds Needed for Production
Total Cost of Direct Materials Purchases
Units to be Produced
Total Direct Labor Cost
Desired Ending Direct Materials
Cost per Pound
Total Required Direct Labor Hours
Desired Ending Finished Goods Units
Direct Labor Time per Unit
Total Materials Required
Total Required Units
Beginning Direct Materials
Direct Labor Cost per Hour
Direct Materials per Unit
Beginning Finished Goods Units
Direct Materials Purchases
Expected Unit Sales
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Direct Materials Purchases
Desired Ending Finished Goods Units
Total Materials Required
Direct Labor Time per Unit
Direct Materials per Unit
Direct Labor Cost per Hour
Units to be Produced
Desired Ending Direct Materials
Expected Unit Sales
Total Cost of Direct Materials Purchases
Beginning Finished Goods Units
Cost per Pound
Total Direct Labor Cost
Total Pounds Needed for Production
Total Required Direct Labor Hours
Total Required Units
Beginning Direct Materials
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Total Direct Labor Cost
Expected Unit Sales
Total Cost of Direct Materials Purchases
Direct Labor Time per Unit
Total Required Units
Direct Materials Purchases
Beginning Finished Goods Units
Direct Materials per Unit
Beginning Direct Materials
Units to be Produced
Total Materials Required
Desired Ending Finished Goods Units
Total Pounds Needed for Production
Direct Labor Cost per Hour
Total Required Direct Labor Hours
Cost per Pound
Desired Ending Direct Materials
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
[Entry field with correct answer]

Total Pounds Needed for Production
Total Required Units
Direct Labor Cost per Hour
Direct Materials Purchases
Total Required Direct Labor Hours
Desired Ending Finished Goods Units
Units to be Produced
Direct Labor Time per Unit
Beginning Direct Materials
Beginning Finished Goods Units
Cost per Pound
Total Direct Labor Cost
Direct Materials per Unit
Total Materials Required
Desired Ending Direct Materials
Expected Unit Sales
Total Cost of Direct Materials Purchases
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]

Prepare the direct labor budget. (Enter Direct labor time per unit in proportion to hours, e.g. for 45 minutes the proportion will be 0.75.)

COOK FARM SUPPLY COMPANY
Direct Labor Budget
[Entry field with correct answer]

For the Six Months Ending June 30, 2017
June 30, 2017
For the Quarter Ending June 30, 2017
Quarter
Six
Months
1
2
[Entry field with correct answer]

Direct Materials Purchases
Total Materials Required
Desired Ending Finished Goods Units
Total Pounds Needed for Production
Total Required Direct Labor Hours
Beginning Direct Materials
Beginning Finished Goods Units
Expected Unit Sales
Cost per Pound
Total Cost of Direct Materials Purchases
Total Required Units
Desired Ending Direct Materials
Direct Labor Cost per Hour
Total Direct Labor Cost
Direct Labor Time per Unit
Units to be Produced
Direct Materials per Unit
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Expected Unit Sales
Cost per Pound
Total Pounds Needed for Production
Total Required Direct Labor Hours
Total Materials Required
Total Required Units
Total Direct Labor Cost
Desired Ending Direct Materials
Total Cost of Direct Materials Purchases
Units to be Produced
Desired Ending Finished Goods Units
Direct Labor Cost per Hour
Beginning Direct Materials
Direct Materials Purchases
Beginning Finished Goods Units
Direct Labor Time per Unit
Direct Materials per Unit
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Beginning Direct Materials
Beginning Finished Goods Units
Direct Labor Cost per Hour
Total Required Direct Labor Hours
Cost per Pound
Desired Ending Direct Materials
Desired Ending Finished Goods Units
Direct Materials Purchases
Total Cost of Direct Materials Purchases
Direct Labor Time per Unit
Total Materials Required
Expected Unit Sales
Direct Materials per Unit
Total Direct Labor Cost
Total Pounds Needed for Production
Total Required Units
Units to be Produced
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Desired Ending Direct Materials
Direct Materials per Unit
Expected Unit Sales
Direct Materials Purchases
Total Materials Required
Desired Ending Finished Goods Units
Total Pounds Needed for Production
Beginning Direct Materials
Total Cost of Direct Materials Purchases
Total Direct Labor Cost
Beginning Finished Goods Units
Direct Labor Cost per Hour
Units to be Produced
Cost per Pound
Total Required Units
Direct Labor Time per Unit
Total Required Direct Labor Hours
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
[Entry field with correct answer]

Cost per Pound
Direct Labor Time per Unit
Total Required Direct Labor Hours
Units to be Produced
Beginning Direct Materials
Direct Materials Purchases
Direct Materials per Unit
Beginning Finished Goods Units
Desired Ending Finished Goods Units
Direct Labor Cost per Hour
Desired Ending Direct Materials
Total Cost of Direct Materials Purchases
Expected Unit Sales
Total Direct Labor Cost
Total Required Units
Total Materials Required
Total Pounds Needed for Production
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]

Prepare the selling and administrative expense budget.

COOK FARM SUPPLY COMPANY
Selling and Administrative Expense Budget
[Entry field with correct answer]

June 30, 2017
For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
Quarter
Six
Months
1
2
[Entry field with correct answer]

Variable Cost
Budgeted sales in units
Total
Fixed Cost
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]

[Entry field with correct answer]

Budgeted sales in units
Variable Cost
Fixed Cost
Total
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
[Entry field with correct answer]

Variable Cost
Fixed Cost
Total
Budgeted sales in units
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Budgeted sales in units
Total
Fixed Cost
Variable Cost
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]
$
[Entry field with incorrect answer]

LINK TO TEXT
LINK TO TEXT

[Partially correct answer.] Your answer is partially correct. Try again.

Prepare the budgeted multiple-step income statement for the first 6 months. (Round intermediate calculations to 2 decimal places and final answer to 0 decimal places, e.g. 1,255.)

COOK FARM SUPPLY COMPANY
Budgeted Income Statement
[Entry field with correct answer]

June 30, 2017
For the Quarter Ending June 30, 2017
For the Six Months Ending June 30, 2017
[Entry field with correct answer]

Sales
Interest Expense
Income Before Income Tax
Beginning Inventory
Operating Expenses
Net Income / (Loss)
Purchases
Selling and Administrative Expenses
Gross Profit
Cost of Goods Sold
Total Operating Expenses
Ending Inventory
Income from Operations
Income Tax Expense
$
[Entry field with incorrect answer]
[Entry field with correct answer]

Total Operating Expenses
Income from Operations
Income Tax Expense
Beginning Inventory
Cost of Goods Sold
Net Income / (Loss)
Interest Expense
Operating Expenses
Ending Inventory
Gross Profit
Purchases
Selling and Administrative Expenses
Sales
Income Before Income Tax
[Entry field with incorrect answer]
[Entry field with correct answer]

Income Tax Expense
Gross Profit
Purchases
Interest Expense
Income Before Income Tax
Sales
Selling and Administrative Expenses
Total Operating Expenses
Net Income / (Loss)
Income from Operations
Beginning Inventory
Cost of Goods Sold
Operating Expenses
Ending Inventory
[Entry field with incorrect answer]
[Entry field with correct answer]

Operating Expenses
Cost of Goods Sold
Selling and Administrative Expenses
Sales
Beginning Inventory
Ending Inventory
Total Operating Expenses
Gross Profit
Purchases
Interest Expense
Income from Operations
Income Before Income Tax
Income Tax Expense
Net Income / (Loss)
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Income from Operations
Gross Profit
Beginning Inventory
Net Income / (Loss)
Interest Expense
Purchases
Sales
Selling and Administrative Expenses
Income Tax Expense
Cost of Goods Sold
Income Before Income Tax
Total Operating Expenses
Operating Expenses
Ending Inventory
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Net Income / (Loss)
Beginning Inventory
Income Before Income Tax
Operating Expenses
Gross Profit
Purchases
Cost of Goods Sold
Sales
Ending Inventory
Income from Operations
Income Tax Expense
Selling and Administrative Expenses
Total Operating Expenses
Interest Expense
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Purchases
Net Income / (Loss)
Cost of Goods Sold
Operating Expenses
Sales
Selling and Administrative Expenses
Income from Operations
Ending Inventory
Total Operating Expenses
Income Tax Expense
Interest Expense
Income Before Income Tax
Beginning Inventory
Gross Profit
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Total Operating Expenses
Gross Profit
Interest Expense
Operating Expenses
Income Before Income Tax
Income from Operations
Beginning Inventory
Cost of Goods Sold
Income Tax Expense
Net Income / (Loss)
Ending Inventory
Purchases
Sales
Selling and Administrative Expenses
[Entry field with incorrect answer]
[Entry field with correct answer]

Gross Profit
Income from Operations
Sales
Beginning Inventory
Interest Expense
Total Operating Expenses
Cost of Goods Sold
Income Before Income Tax
Selling and Administrative Expenses
Ending Inventory
Income Tax Expense
Net Income / (Loss)
Operating Expenses
Purchases
$
[Entry field with incorrect answer]

An agency is having problems with personal phone calls made during working hours. Each minute of a personal call costs the agency $0.25 in wasted wages. The agency decides to hire operators to monitor calls in order to attain the optimal number of personal calls (minimize total cost of personal calls). Number of Operators Total minutes of personal calls (per hour)

# of operators total mins of personal calls per hour

0 685

1 585

2 500

3 430

4 380

5 345

6 320

a. What is the most the agency would be willing to pay the first operator?

b. If operators are paid $17.25 an hour, how many operators should the agency hire?

c. Assume that the cost of personal calls temporarily falls to $0.21 in wasted wages. If the operator wage is still $17.25/hour, how many operators should the agency hire now?

d. Assume a change in the operator labor market results in operator wages falling dramatically to $8.75 an hour; with the cost of personal calls going back to the original $0.25 per minute, how would this affect the number of operators the agency should optimally hire?

Bandar Industries Berhad of Malaysia manufactures sporting equipment. One of the company’s products, a football helmet for the North American market, requires a special plastic. During the quarter ending June 30, the company manufactured 3,100 helmets, using 2,077 kilograms of plastic. The plastic cost the company $13,708.

According to the standard cost card, each helmet should require 0.58 kilograms of plastic, at a cost of $7.00 per kilogram.

Required:

1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,100 helmets?

2. What is the standard materials cost allowed (SQ × SP) to make 3,100 helmets?

3. What is the materials spending variance?

4. What is the materials price variance and the materials quantity variance?

(For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations.)

1. standard quantity of kilograms allowed

2. standard cost allowed for actual output

3. materials spending variance

4. materials prices variancs

materuaks quantity variance

Brighton Services repairs locomotive engines. It employs 100 full-time workers at $17 per hour. Despite operating at capacity, last year's performance was a great disappointment to the managers. In total, 10 jobs were accepted and completed, incurring the following total costs:

Direct Materials: $1,054,400

Direct Labor: $4,760,000

Manufacturing Overhead: $1,120,000

Of the $1,120,000 manufacturing overhead, 35 percent was variable overhead and 65 percent was fixed. This year, Brighton Services expects to operate at the same activity level as last year, and overhead costs and the wage rate are not expected to change. For the first quarter of this year, Brighton Services completed two jobs and was beginning the third (job 103). The costs incurred follow:

You are a consultant associated with Lodi Consultants, which Brighton Services has asked to help. Lodi's senior partner has examined Brighton Services' account and has decided to divide actual factory overhead by job into fixed and variable portions as follows

In the first quarter of this year, 30 percent of the marketing and administrative cost was variable and 70 percent was fixed. You are told that Jobs 101 and 102 were sold for $875,000 and $588,000 respectively. All over- or underapplied overhead for the quarter was written off to COGS

Required Questions:

1. Using last year's overhead costs and direct-labor hours as this year's estimate, calculate predetermined overhead rates per DL hour for variable and fixed overhead (based on other examples, i got $1.40 and $2.60)

2. Present inT-accounts the normal manufacturing cost flows for the three jobs in the first quarter of this year. Use the overhead rates derived in the first requirement (this is where a lot of my confusion is, many of the other examples show the t-accounts but none explain HOW to use the overhead rates to determined the values used in the t- accounts. I would really appreciate if you could explain this process!)

3. Calculate operating profit (loss) for the first quarter of this year under actual and normal costing systems

act12.2
A PAYG instalment payer can vary the PAYG instalments if they believe that their circumstances have changed and that they might be paying too little or too much. Consider the following scenario, the rates are examples only and do not reflect current tax rates. The ATO has calculated the businesses rate to be 18.75% based on an income from the previous assessable period of $90,000. The instalment income for the first quarter (1 July to 30 September) was $21,000 and the second quarter (1 October to 31 December) was $15,000. The business has paid PAYG for the first two quarters of the year based on this rate but sales have dropped dramatically and expected income for the year is anticipated to be around $60,000. They have calculated their estimated income tax to be $8,900.
a. Calculate the new instalment rate based on these figures
b. Calculate how much the business paid in the first two instalments
c. Calculate the variation credit that can be claimed and explain why it can be claimed. Show the calculations

The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods:

The gross margin is 25% of sales.

Actual and budgeted sales data:

Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are a result of March credit sales.

Each month’s ending inventory should equal 80% of the following month’s budgeted cost of goods sold.

One-half of a month’s inventory purchases is paid for in the month of purchase; the other half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory.

Monthly expenses are as follows: commissions, 12% of sales; rent, $3,700 per month; other expenses (excluding depreciation), 6% of sales. Assume that these expenses are paid monthly. Depreciation is $837 per month (includes depreciation on new assets).

Equipment costing $2,900 will be purchased for cash in April.

Management would like to maintain a minimum cash balance of at least $4,000 at the end of each month. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total loan balance of $20,000. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. The company would, as far as it is able, repay the loan plus accumulated interest at the end of the quarter.

Required:

Using the preceding data:

1. Complete the following schedule:

2. Complete the following:

3. Complete the following cash budget:

4. Prepare an absorption costing income statement for the quarter ended June 30.

5. Prepare a balance sheet as of June 30.

Complete the following schedule:

Complete the following:

NOTE:- you have to refer the 10k report to do this question (the link is given below).. there is no separate data given.

Part 1

Using the 10K report for the firm you are analyzing, calculate your estimate of the weighted average cost of capital for the firm. Please justify your response and document all calculations.

10K report link : go to: https://investor.textron.com/investors/investor-resources/annual-report-and-proxy-materials/default.aspx , scroll down and "select 2016 annual report PDF"

direct link to the 10k report : https://s1.q4cdn.com/535492436/files/doc_financials/2016/Textron-AR2016-compiled.pdf

Part 2

(Using the same report from above)

1. What was the dollar value of the capital spending in the most recent 10K report?

2. Describe the major capital expenditures of the company (i.e. aircraft, equipment, etc.)

3. Find the Notes in the financial statements describing the capital spending. What do they reveal about the capital spending process at the company?

. For the questions, your report should include the formulated hypotheses, steps of calculation and formulas, your answers and conclusions, and the results from Excel.

A retail company has started a new advertising campaign in order to increase sales. In the past, the mean spending in both the 18–35 and 35+ age groups was at most $70.00. a. Formulate a hypothesis test to determine if the mean spending has statistically increased to more than $70.00.

b. After the new advertising campaign was launched, a marketing study found that the sample mean spending for 400 respondents in the 18–35 age group was $73.65, with a sample standard deviation of $56.60. Is there sufficient evidence to conclude that the advertising strategy significantly increased sales in this age group with significance level of 5%?

c. For 600 respondents in the 35+ age group, the sample mean and sample standard deviation were $73.42 and $45.44, respectively. Is there sufficient evidence to conclude that the advertising strategy significantly increased sales in this age group with significance level of 5%?