Analyze and evaluate the potential impact a change from U.S. GAAP to IFRS would have on U.S. companies for revenue recognition of goods and services. This includes both the impact on specific amounts in the financial statements, in addition to the impact on various stakeholders associated with a company (e.g., creditors, investors, suppliers, management, employees, etc.).

Analyze and evaluate the potential impact a change from U.S. GAAP to IFRS would have on U.S. companies for revenue recognition of goods and services. This includes both the impact on specific amounts in the financial statements, in addition to the impact on various stakeholders associated with a company (e.g., creditors, investors, suppliers, management, employees, etc.).

You have been made CEO of Ferrari, and your explicit objective is to grow the company through diversification (i.e., exploiting new products and markets). What options are immediately available to you? What business-wide considerations will affect your ability to execute your strategy? recoommede word count is 300-400 words

Assume that Timberline Corporation has 2019 taxable income of $270,000 for purposes of computing the §179 expense. It acquired the following assets in 2019: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.)

Required:

1. a-1. What is the maximum amount of §179 expense Timberline may deduct for 2019?

2. a-2. What is Timberline’s §179 carryforward to 2020, if any?

5. A machine was acquired on January 1, 2018, at a cost of $80,000. The machine was originally estimated to have a residual value of $5,000 and an estimated life of 5 years. The machine is expected to produce a total of 100,000 components during its life, as follows: 15,000 in 2018, 20,000 in 2019, 20,000 in 2020, 30,000 in 2021, and 15,000 in 2022.

Instructions

(a)   Calculate the amount of depreciation to be charged each year, using each of the following methods :

       1.    Straight-line method

       2.    Units-of-production

       3.    Double diminishing-balance

(b)        Which method results in the highest depreciation expense during the first two years? Over all five years?

The comparative statement of financial position of Blue Spruce Corporation as at December 31, 2020, follows:

Net income of $37,900 was reported and dividends of $12,500 were declared and paid in 2020. New equipment was purchased, and equipment with a carrying value of $4,800 (cost of $11,900 and accumulated depreciation of $7,100) was sold for $8,100.

How Falling Oil Prices in Early 2020 Weakened the U.S. Economy

Lutz Kilian, Michael D. Plante and Xiaoqing Zhou

May 19, 2020

The benchmark West Texas Intermediate (WTI) price of oil dropped by more than half from Jan. 21 to April 3. There is a long tradition of economists arguing that lower oil prices, all else equal, are good for the United States economy. Thus, one might have expected this dramatic price cut to have been a much-needed piece of welcome news.

Indeed, President Trump tweeted that the oil price drop “is good for the consumer” on March 9. The Wall Street Journal echoed this sentiment, calling low oil prices “a gift to U.S. consumers” on April 2. This view would have seemed reasonable just a few years ago, but it is no longer accurate today.

Instead, we will show that on balance this oil price decline has weakened rather than strengthened the U.S. economy, making this event different from past episodes of falling oil prices.

Consumer Spending Channel

How much an unexpected shift in the oil price matters for the U.S. economy, in general, depends on how much consumers spend on gasoline as a share of their overall spending. It also depends on how much of that spending is transferred abroad. Every dollar spent on oil or gasoline imported from abroad ends up in the hands of a foreign oil producer who is less likely to spend this revenue in the U.S.

Thus, normally, lower oil prices stimulate U.S. aggregate demand, as consumers have more discretionary income left for other purchases after paying less at the gas pump; conversely, higher oil and gasoline prices reduce aggregate domestic spending and lower economic growth.

Of course, this argument applies only to consumers who actually spend money on gasoline. The first point to keep in mind is that when consumers are cooped up at home with their cars sitting idle in the driveway, they are unlikely to take advantage of lower gasoline prices. Shelter-in-place policies greatly and almost instantaneously reduce the gasoline expenditure share, thereby limiting the direct effect of lower oil prices on domestic consumers.

A second point is that the U.S. economy has undergone major changes in the wake of the shale oil revolution. Historically, the U.S. economy was heavily dependent on petroleum imports. By late 2019, net petroleum imports on average had reached about zero (Chart 1). Thus, regardless of how much more consumers spend on gasoline, lower oil and gasoline prices do not mean that aggregate spending in the U.S. economy goes up.

Downloadable chart | Chart data

A third caveat is that the 2020 oil price decline in part was driven by lower U.S. demand for fuels, as state and local governments issued stay-at-home orders and many businesses shut down. This fact further helps explain why this time lower oil prices did not cause a boom in consumption and non-oil business investment.

Oil Sector Investment Spending Channel

It may seem that businesses more broadly should benefit from lower production costs, as oil prices decline, but that effect tends to be negligible in practice for most industries. A more important component of the transmission of lower oil prices to the U.S. economy is that they cause the oil sector to cut back on fixed-investment expenditures.

This effect occurs independently of whether there is a consumption boom and can be large enough in the aggregate to offset any consumption stimulus. In the current environment, the sharp reduction in capital expenditures by oil companies explains why this oil price decline, on balance, actually hurt U.S. investment spending—and hence, economic growth—not only in oil-producing regions, but overall. Capital expenditures by the industry are projected to decline by an additional 30 percent from previously announced levels and are likely to fall further, consistent with a sharp reduction in oil investment in 2020.

Implications for the Banking System

Independently of these expenditure shifts, there has also been concern that lower oil prices may undermine the stability of the banking system with potential spillovers to the economy at large. Because bank loans are securitized by oil reserves that are valued based on the oil futures curve—a measure of what investors believe oil will be worth in the future—a dramatic drop in oil prices matters to banks that are heavily involved in lending to oil companies. One measure of this effect is the decline in banks’ stock valuations when confronted with a large decline in the price of oil.

This argument is reminiscent of the housing crisis of 2007–09. Prior to that crisis, banks nationwide had 37 percent of their loan portfolios in residential mortgages. As house prices collapsed in 2007–09, the return on bank stocks cumulatively declined by 32 percent more than the overall stock market because banks had become overly exposed to house price corrections.

There is no evidence, however, that banks today are similarly dependent on oil-sector lending. Even for the most-exposed banks, the share of bank loans to the energy sector was no larger than 18 percent in the fourth quarter of 2019. Few banks had an exposure greater than 2 percent. Moreover, tighter regulations have forced banks to hold more reserves against potential loan losses.

Standard & Poor’s 500 bank stocks dropped by 19 percent relative to the overall stock market between Jan. 21—when awareness of the COVID-19 virus in the U.S. emerged—and April 3, compared with a decline of 23 percent for S&P 500 energy companies. Put differently, the excess decline experienced by bank stocks relative to the market has been about half of the excess decline of bank stocks during the housing crisis. Thus, there is no evidence to date that the crisis in the oil sector has spilled over into the banking sector more broadly.

In fact, there are many other reasons why bank stocks were hit particularly hard during the current crisis—notably the stress experienced by the broader financial system and falling interest rates. Thus, our analysis likely overstates the systemic impact of lower oil prices on banks’ stock returns.

explain changes in: Aggregate Demand and Aggregate Supply Money Demand Money Supply Exchange rate of the dollar.

Suppose the following: You are an HR Director for a US-based company and are preparing to hire a Chinese citizen for a job in the U.S., which will require him to attain H-1B visa in order to be eligible for employment in the U.S. Research and discuss the process of attaining an H-1B visa. What are the requirements of the employee? What are the requirements and committments of the company? When does it make business sense to support an H-1B visa for an employee?

The response should be a minimum of 500 words.

Thank you!

On August 1, 2020, Kazazis Company sold inventory to Magic Company and received Magic’s 9-month, noninterest-bearing $100,000 note due April 30, 2021. The cash selling price of the inventory was $94,000. The cost of the inventory was $60,000. Kazazis records adjusting entries annually at December 31.

a. Record the August 1, 2020, journal entries (including COGS) for Kazazis.

b. If Kazazis recorded the note as an interest-bearing note on August 1, 2020, (i.e., did not record a discount on the note), how would the financial statements be misstated (overstated/understated and $ amount)?. (Hint: Record the entry without the discount and compare to your answer in part a.)ASSETSLIABILITIESSE2020 NET INCOME$$$$OverstatedOverstatedOverstatedOverstatedUnderstatedUnderstatedUnderstatedUnderstated

c. Record the December 31, 2020, adjusting entry for Kazazis.

d. If Kazazis’ 2020 net income without including the Aug. 1 sale or December 31 adjusting entry was $200,000, what is the correct 2020 net income? Ignore taxes.

e. What amounts related to the note will Kazazis report on its 2020 balance sheet?

f. Record the April 30, 2021, journal entry/entries for Kazazis. (You may choose to record 1 entry as we did in the example in class or 2 entries as required by Connect.)

Major Communications Ltd., a publicly traded company that specializes in data capture, has been in operation for several years. On October 1, 2019, it had 10 million common shares authorized and 1.5

million shares issued at an average value of $30 per share. As well, there were 1 million preferred shares authorized, with 200,000 of them issued at $15 per share. On October 1, 2019, the balance in Retained Earnings was $20,375,000. During the fiscal year 2020, the following transactions affected shareholders' equity:

1. On November 1, 2019, 400,000 new common shares were issued at $32 per share.
2. On March 15, 2020, a 5% common stock dividend on the outstanding shares was declared and distributed when the market price was $45 per share.
3. On September 1, 2020, a dividend of $5.15 per common share was declared. The date of record was September 15, 2020, with the date of payment being October 5, 2020.
4. The preferred shares pay an annual dividend of $1.20. The preferred dividend for the year was declared and paid.
5. During the fiscal year ended September 30, 2020, the company generated net income after taxes of $25 million. RequiredComplete the below statement of changes in shareholders' equity as at September 30, 2020