1. From the FASB, what is the intended purpose of the new converged revenue recognition standard?

2.How prevalent is sustainability reporting in (a) the U.S. and (b) globally? In citing specific statistics, indicate the size of the company to which the information pertains.

3. What standards or guidelines should accounting professionals involved in sustainability reporting be familiar with?

Are intercollegiate athletics departments generating sufficient revenue to cover the expenses required to operate these entities? (1) If so, how/where are they generating the revenue? How can these athletics departments operate as non-profit if they are generating enormous amounts of revenue? (2) If not, how can they continue to operate when they are losing money annually? Many universities are public entities which require a balance budget so how do they offset the losses associated maintaining an athletics department? Are there any issues associated with the strategies implemented by universities?

In this exercise, we will use our knowledge of the relationships between revenue, variable costs, fixed costs, contribution margin, operating margin, and unit charge or sales price. We will calculate the number of UOS we need to perform to break even, what the revenue needed to achieve a target operating income, and compute the contribution income statement to prove our results. Please use the Contribution Margin Method to arrive at your answers and show all your calculations for the answer and the proof.

Case 1:

The Laboratory Manager wants to know the number of lab test procedures it will take to achieve the desired operating income of $450,000 next year.

Data Assumptions:

Unit charge for each lab test $250

Variable cost per lab test $150

Total fixed costs $125,000

Please calculate the number of tests needed to be performed and the total revenue needed to achieve an operating income of $450,000. Then compute the contribution income statement method to prove your answers. Please show all calculations.

Case 2:

Now the Laboratory Manager wants to know how many of the lab test procedures will need to be performed to break even next year. Use the same data assumptions you have from the above example. Please calculate the number of lab tests needed to be done to break even and use the contribution income statement method to prove your answer. Please show all calculations.

Case 3:

The Laboratory Manager now wants to forecast what her operating income will be if the Lab performs 3,000 lab tests next year. Use the same data assumptions shown above and calculate the operating income for performing 3,000 tests using the contribution margin income statement method. Please show all calculations.

Rubric

1. The tax officials at the Internal revenue Service (IRS) are constantly working toward improving the wording and format of the tax returns. As part of a larger effort to help taxpayers, the Internal Revenue Service plans to streamline one of the forms into a shorter and simpler form for the 2021 tax season.

2. Upon successful completion of this exercise, the new form, – about half the size of the current version – would replace the previous ones and will be shared with the tax community for the feedback. The new Form uses a “building block” approach, in which the tax return is reduced to a simple form. That form can be supplemented with additional schedules if needed. Taxpayers with straightforward tax situations would only need to file this new form with no additional schedules.

To finalize this exercise, the IRS have developed three new forms, and to determine which, if any, are superior to the current forms, 120 individuals were asked to participate in an experiment. Each of the three new forms and the currently used form were filled out by 30 different people. The amount of time (in minutes) taken by each person to complete the task was recorded. The data collected is attached in the Excel file named: Tax Forms worksheet.

You are expected to analyze the project in two phases:

Phase1:

1. a) Describe the problem background, objective of study and identify the type of scale of measurement for the data

2. b) Use appropriate descriptive statistics to explore and summarize the data for Tax form 2 & 3 and compare their results. Remember to interpret the findings accurately and present them in a clear and coherent way.

3. c) Assuming data for Form 2 is normally distributed, calculate the parentage of people who completed the form between 83.9 and 107.5 minutes (round the descriptive statistics numbers to one decimal)

4. d) If the filling time of all IRS forms is distributed normally with mean of 102 and standard deviation of 8, what is the probability that a randomly selected person could do the tax forms in less than 90 minutes?

e) Referring to problem “d” above, If a randomly selected person is in the top 5 percent of the fastest people who do the tax forms, at least how many minutes should he spent to fill out the form?

"Excel sheet numbers:

Taxpayer Form 1 ------Form 2------- Form 3 ------Form 4

1-------------- 109 ------------115 ----------126 -----------120

2-------------- 98 -------------103 ----------107 -----------108

3 -------------29 --------------27------------ 53------------- 38

4------------ 93 ---------------95 ------------103---------- 109

5------------ 62--------------- 65------------ 67------------- 64

6 -----------103------------- 107----------- 111----------- 128

7------------ 83-------------- 82------------ 101------------ 116

8------------ 122------------ 119----------- 141----------- 143

9 -------------92------------ 101----------- 105------------ 108

10------------ 107--------- 113------------- 127----------- 113

11------------ 103---------- 111------------ 111------------ 108

12------------ 54------------ 64-------------- 67-------------62

13------------ 141---------- 145----------- 142------------160

14------------ 92------------ 94------------- 95-------------102

15 ------------29 -----------32------------- 33---------------62

16----------- 83------------- 83------------ 89-------------- 86

17------------ 34 -----------36 ------------40---------------48

18 ------------83----------- 86------------- 90-------------119

19------------ 157---------- 157----------- 172-----------193

20------------- 99---------- 107------------- 111-----------100

21----------- 118----------- 123------------- 117----------130

22------------ 58----------- 65--------------- 75-------------81

23 ------------66----------- 71---------------- 79------------81

24------------ 60----------- 60--------------- 78------------ 41

25 ------------102---------- 106------------ 100---------- 142

26 -------------128---------- 134------------ 135--------- 142

27---------------87---------- 93------------- 90------------ 77

28--------------126-------- 134----------- 129----------- 154

29----------- -133---------- 130----------- 148----------- 164

30------------ 100----------- 112---------- 107----------- 120

The table shows total cost and total revenue information for a perfectly (or purely) competitive firm.

Firms earning a loss will sometimes shut down in the short run. What quantity will the firm produce if it shuts down in the short run?

unitsunits

What will the profits be if this firm shuts down?

$

Firms sometimes prefer to minimize losses by continuing to operate in the short run. What quantity will the firm produce to minimizes losses in the short run?

unitsunits

If this firm chooses to operate, what will its profits equal? Enter a negative number for a loss.

$

If the cost and revenue numbers in the table will continue forever (permanently), is it better for this firm to

shut down immediately.

continue to operate indefinitely.

continue to operate in the short run, and exit the market in the long run.

The Internal Revenue Service reports that the mean federal income tax paid in the year 2010 was $8040. Assume that the standard deviation is $4800. The IRS plans to draw a sample of 1000 tax returns to study the effect of a new tax law.

What is the probability that the sample mean tax is less than $1800?

What is the probability that the sample mean tax between $7400 and $8000?

40th percentile of the sample mean is ?

1. An investment is expected to generate a revenue stream as follows:

1. The present value (PV) of the investment assuming an annual interest rate of 13%

2. The future value (FV) of the investment assuming an annual interest rate of 13%

3. The present value of the investment assuming a uniform series of payments in the amount of $6,000 and an annual interest rate of 13%

4. The future value of the investment assuming a uniform series of payments in the amount of $6,000 and an annual interest rate of 13%

How can we explain how a companies revenue can be related to the general state of the economy with economic indicators such as Retail Index, Consumer Price Index and Personal Consumption.

The following information is available for year 1 for Pepper Products:

   
All depreciation charges are fixed and are expected to remain the same for year 2. Sales volume is expected to fall by 7 percent, but prices are expected to rise by 18 percent. Material costs per unit are expected to increase by 14 percent. Other unit variable manufacturing costs are expected to decrease by 6 percent per unit. Fixed cash costs are expected to increase by 6 percent.

Variable marketing costs will change with unit volume. Administrative cash costs are expected to increase by 7 percent. Inventories are kept at zero. Pepper Products operates on a cash basis.

Required:

Prepare a budgeted income statement for year 2. (Do not round intermediate calculations.)

PEPPER PRODUCTS
? Budgeted Income Statement
      For Year 2

The Internal Revenue Code allows a corporation to carry back or carry forward an “operating loss” for a given year.

How would you define an operating loss carryback and a carryforward explaining the conceptual questions that surround these issues?