Start with the partial model in the file Ch03 P15 Build a Model.xls from the textbook’s
Web site. Joshua & White (J&W) Technologies’s financial statements are also shown
below. Answer the following questions. (Note: Industry average ratios are provided in
Ch03 P15 Build a Model.xls.)
a. Has J&W’s liquidity position improved or worsened? Explain.
b. Has J&W’s ability to manage its assets improved or worsened? Explain.
c. How has J&W’s profitability changed during the last year?
d. Perform an extended Du Pont analysis for J&W for 2009 and 2010. What do
these results tell you?
e. Perform a common size analysis. What has happened to the composition (that is,
percentage in each category) of assets and liabilities?
f. Perform a percentage change analysis. What does this tell you about the change
in profitability and asset utilization?

Joshua & White Technologies: December 31 Balance Sheets
(Thousands of Dollars)
Assets 2010 2009

Liabilities
& Equity 2010 2009

Cash and cash
equivalents $ 21,000 $ 20,000 Accounts payable $ 33,600 $ 32,000
Short-term
investments 3,759 3,240 Accruals 12,600 12,000
Accounts
receivable 52,500 48,000 Notes payable 19,929 6,480
Inventories 84,000 56,000

Total current
liabilities $ 66,129 $ 50,480

Total current
assets $161,259 $127,240

Long-term
debt 67,662 58,320
Net fixed assets 218,400 200,000 Total liabilities $133,791 $108,800
Total assets $379,659 $327,240 Common stock 183,793 178,440

Retained
earnings 62,075 40,000
Total common
equity $245,868 $218,440
Total liabilities
& equity $379,659 $327,240
Joshua & White Technologies December 31 Income Statements
(Thousands of Dollars)

2010 2009
Sales $420,000 $400,000
Expenses excluding depr. & amort. 327,600 320,000
EBITDA $ 92,400 $ 80,000
Depreciation and amortization 19,660 18,000
EBIT $ 72,740 $ 62,000

resource
116 Part 1: Fundamental Concepts of Corporate Finance

2010 2009
Interest expense 5,740 4,460
EBT $67,000 $57,540
Taxes (40%) 26,800 23,016
Net income $40,200 $34,524
Common dividends $18,125 $17,262
Other Data 2010 2009
Year-end stock price $ 90.00 $ 96.00
Number of shares (Thousands) 4,052 4,000
Lease payment (Thousands of Dollars) $20,000 $20,000
Sinking fund payment (Thousands of Dollars) $ 0 $ 0

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.

Consider each of the following independent and material situations, identified below (i-v). In each case: • the balance date is 30 June 2020; • the field work was completed on 12 August 2020; • the Directors’ Declaration and the Audit report were signed on 19 August 2020; • the completed financial report accompanied by the signed Audit report was mailed to the shareholders on 25 August 2020. (i) On 29 September 2020, you discovered that a debtor at 30 June 2020 had gone bankrupt on 1 September 2020. The debt had appeared collectible at 30 June 2020 and 19 August 2020. (ii) On 12 August 2020, you discovered that a debtor had gone bankrupt on 1 August 2020. The sale took place on 15 July 2020. The cause of the bankruptcy was a major uninsured fire at one of the debtor’s premises on 1 July 2020. (iii) On 13 August 2020, you discovered that a debtor at 30 June 2020 had gone bankrupt on 5 August 2020. The cause of the bankruptcy was an unexpected loss of a major lawsuit issued against the debtor on 10 June 2020. (iv) On 20 August 2020, the company settled a legal action out of court that had originated in 2016 and was listed as a contingent liability at 30 June 2020. (v) On 1 September, you found a letter dated 15 August with a $2 million fine from Environmental Protection Agency. The letter stated that company had illegally dumped chemicals on 15 May 2020. Required: 1. For each of the events described above (i-v), select the appropriate action from the list below, and justify your response. A. Adjust the 30 June 2020 financial report. B. Disclose the information in the notes to the 30 June 2020 financial report. C. Request that the client recall the 30 June 2020 financial report for revision. D. No action is required. (5*1.5= 7.5 marks) 2. If no action is taken by management for each of the events described above (i-v), determine the most appropriate audit opinion to be issued.

Be able to identify valid and non-valid programmer-defined identifiers. Which header file do you need in order to use the cout and cin objects? Which header file do you need to create string variables? Be able to recognize the correct syntax to define a constant. Be able to recognize the correct syntax to store a character in a char variable. What must you have for every variable you use in a program? Program Given a program, be able to fill in missing blanks with preprocessor directives, namespace statement parts, function definition, punctuation, constant and/or variable names/types, cout/cin statements and return statements. If you can write a complete basic program at this point, you should be good to go.

John Wilson

2.John Wilson is a forty-year old computer programmer, husband, and father of four. He wants to use the capital retention approach to determine how much life insurance he should purchase. Because of his $105,000 salary and the need to care for the family’s four children, his wife does not work outside the home. The family’s current annual living expenses are approximately $75,000, including $8,000 in annual IRA contributions. John prefers to use the capital retention approach (CRA) so that he can be reasonably assured that his family will not exhaust the proceeds of a life insurance policy. However, he also wants to consider the possible reduction in expenses and apply a 70 percent replacement ratio to the calculation.

a.Calculate John’s insurance need using the capital retention approach and an after-tax discount rate of 5.5 percent (assume end-of period payment of benefits).

b.Calculate John’s insurance need using the human life value approach (HLV), an after-tax discount rate of 5.5 percent, and a remaining working life of twenty five years (assume end-of period payment of benefits).

c.After your presentation, John was bewildered about why the HLV and CRA calculations resulted in significantly different insurance needs. Using the two formulas as a guide, explain to John why this result occurred.

For the year ended December 31, 2020, Stellar Ltd. reported income before income taxes of $100,000.

In 2020, Stellar Ltd. paid $54,000 for rent; of this amount, $18,000 was expensed in 2020. The remaining $36,000 was treated as a prepaid expense for accounting purposes and would be expensed equally over the 2021-2022 period. The full $54,000 was deductible for tax purposes in 2020.

The company paid $70,000 in 2020 for membership in a local golf club (which was not deductible for tax purposes).

In 2020 Stellar Ltd. began offering a 1-year warranty on all merchandise sold. Warranty expenses for 2020 were $38,000, of which $31,000 was actual repairs for 2020 and the remaining $7,000 was estimated repairs to be completed in 2021.

Meal and entertainment expenses totalled $17,000 in 2020, only half of which were deductible for income tax purposes.

Depreciation expense for 2020 was $190,000. Capital Cost Allowance (CCA) claimed for the year was $217,000.

Stellar was subject to a 20% income tax rate for 2020. Stellar follows IFRS. At January 1, 2020, Stellar Ltd. had no balances in deferred tax accounts.

Calculate taxable income and taxes payable for 2020.

Prepare the journal entries to record 2020 income taxes (current and deferred).

Provide an example application that uses normally open relay Contacts and normally closed relay contacts?

What are the closure properties for CFGs? What does it mean for a CFG to be closed under one of these operations?

In the context of decision making theories, describe the difference between open-loop and closed loop models.