You are a business consultant in a remote and isolated small town. Two customers, a dentist and a portrait artist, came to you to ask for advice. They are considering to raise the price of their service to increase revenue. Write a short report for each of them using your economic training. How would your report be different if all these happened in the context of a great metropolitan area?

Envy Inc. an online shoe retailer, has a return policy that allows customers to return merchandise in unused condition for a full refund within 60 days of purchase. Envy knows from past experience that about 12% of sales are consistently returned.   

Describe how/when Envy should recognize revenue and provide a rational (explanation) for your answer.

The following question presents hypothetical data concerning transfer of cotton between departments as part of the Cotton On Group's production processes. The textile department produces cotton for use by various other production departments within the Cotton On Group. The costs incurred by the textile department to produce cotton are provided below:

The textile department can also sell cotton to external customers for $5.00 per square metre. Sales staff from the textile department are paid a sales commission of $0.10 per square metre for sales to external customers. No sales commissions are paid for transfers to internal customers.

Required

1. Provide and discuss three examples which illustrate how cost-plus pricing could be used to set the internal transfer price for cotton and how these prices impact departmental profitability.
2. Measure and discuss the internal transfer price for cotton if the general transfer price rule is used in the following situations:
   1. The textile department has infinite capacity .
   2. The textile department has no spare capacity .
   3. The textile department has capacity to produce 50,000 metres, internal demand is 40,000 metres and external demand is 17,000 metres .

National Survey of Family Growth 1982-2010

The National Survey of Family Growth (NSFG) provides nationally representative estimates and trends for infertility, surgical sterilization, and fertility among U.S. women and men aged 15-44. The NSFG survey has been administered since 1973, and its latest round in 2006-2010 consisted of 22,682 interviews. Infertility was defined as a lack of pregnancy in the 12 months prior to the survey despite having had unprotected sexual intercourse in each of those months with the same husband or partner. Women were classified as surgically sterile if they had an unreversed sterilizing operation, for example, a tubal sterilization or hysterectomy. Presumed fertile women were based on the residual category of those who did not meet the definitions for surgically sterile or infertile.

1. Using these data and your knowledge, make a testable hypothesis about some aspect of infertility, fertility, or surgical sterilization using the above mentioned data. Identify and count the cases of infertility depending upon age, education, percent of poverty level in the year 2006-2010. Also compare the groups like surgical sterile, infertile and presume fertile. Clearly defined exposure groups, a specific outcome and a stated direction between the exposure and outcome in the years mentioned.

ABC Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes:

Fixed amount per month Variable amount per customer

Revenue $5,000

Payroll cost $50,000 $1,100

Travel expenses $600

Admin expenses $36,000 $500

Other expenses $10,000 $200

When preparing its planning budget, the company estimated that it would serve 60 customers per month; however, during April the company actually served 55 customers.

What amount of net operating income would appear in ABC's static budget for April?

Is there a need to prepare a flexible budget for April? If so, explain why. Further, what amount of net operating income would appear on ABC's flexible budget for April?

A researcher is interested in looking at the effect of sleep and caffeine on physical performance. The researcher has each subject perform a series of 6 tests across a number of week. The researcher alters the amount of sleep the subject should receive (8 hours, 6 hours, and 4 hours) while also altering whether they drink coffee in the morning or they do not. These two factors are completely crossed to create the six conditions. Eight subjects were recruited for the study and performed a physical test in a lab. Higher scores on the test indicate better performance. Report your results, run all hypothesis tests, and provide a final summary of your results. How is this done within SPSS? Please help!

A researcher observes the weight of a class of 36 students in high school. The given table shows the data she collected​ (in kg).   

The researcher wants to test whether the mean weight of all high school students in the state

​(μ​)

would be

70

kg or not.

​So, the null and the alternative hypotheses for the test the researcher wants to conduct​ are:

A.The​ researcher's null hypothesis is

H0: μ=70

and the alternative hypothesis is

HA: μ≠70.

Your answer is correct.

B.The​ researcher's null hypothesis is

H0: μ≥70

and the alternative hypothesis is

HA: μ≤70.

C.The​ researcher's null hypothesis is

H0: μ=70

and the alternative hypothesis is

HA: μ≥70.

D.The​ researcher's null hypothesis is

H0: μ≥70

and the alternative hypothesis is

HA: μ≠70.

For a prespecified​ 5% significance​ level, the

p​-value

of the test the researcher wants to conduct is

nothing.

The restaurant owner Lobster Jack wants to find out what the peak demand periods are, during the hours of operation, in order to be better prepared to serve his customers. He thinks that, on average, 60% of the daily customers come between 6:00pm and 8:59pm (equally distributed in that time) and the remaining 40% of customers come at other times during the operating hours (again equally distributed). He wants to verify if that is true or not, so he asked his staff to write down during one week the number of customers that come into the restaurant at a given hour each day. His staff gave him the following data:

Help the manager figure out if his instincts are correct or not. Use a Chi-Squared test to see if the observed distribution is similar to the expected. Use the average demand for a given time as your observed value.

The owner now wants you to help him analyze his sales data. The restaurant is famous for its Lobo lobster roll. You were given some information based on which you deduced that the demand for the lobster roll was normally distributed with a mean of 220 and standard deviation of 50. You also know that the lobster supplier can provide lobster at a rate that mimics a uniform distribution between 170 and 300. One Lobster is used per roll and the lobsters need to be fresh (i.e. the restaurant can only use the lobsters that are delivered that day).

You decide to run 200 simulations of 1000 days each.

Calculate the expected sales of Lobster roll per day based on your simulation results. Use the expected sales from each of your 200 simulations to create a confidence interval for the average expected sales. What is the 95% confidence interval, L (Your confidence interval is mean +/- L), for this estimate?

12. A CPA examines a sample of copies of December and January sales invoices for the initials of the person who verified the quantitative data and the consistency between prices on purchase order and invoice. This is an example of a:

A) Substantive test with respect to the completeness of revenue.

B) Cutoff test.

C) Tests of internal control.

D) Statistical test.

13. Which of the following revenue related transactions is not linked to the accounts indicated?

A) Recognize revenues too early--accounts receivable and revenue.

B) Understate allowance for doubtful accounts--Bad debt expense, allowance for doubtful accounts.

C) Don't write off uncollectible receivables—accounts receivable, sales discounts.

D) Don't record discounts given to customers--Cash, sales discounts, accounts receivable.

14. Which of the following is necessary if the auditor can plan to observe inventory at interim dates rather than the end of fiscal year?

A) Perpetual inventory records are maintained.

B) Complete recounts are performed by independent teams.

C) Unit cost records are integrated with production-accounting records.

D) The company adopted a sophisticated Peachtree-based accounting system.

15. Effective internal control for purchases generally can be achieved in a well-planned organizational structure with a separate purchasing department that has:

A) The ability to prepare payment vouchers based on the information on a vendor's invoice.

B) The responsibility of reviewing purchase orders issued by user departments.

C) The authority to make purchases of materials and services.

D) A direct reporting responsibility to controller of the organization.