Reid Company is considering the production of a new product. The expected variable cost is $27 per unit. Annual fixed costs are expected to be $810,000. The anticipated sales price is $72 each.

Determine the break-even point in units and dollars using each of the following:

a. Use the equation method.

b. Use the contribution margin per unit approach.

c. Use the contribution margin ratio approach. (Do not round intermediate calculations. Round "Contribution margin ratio" to 1 decimal place. (i.e., .234 should be entered as 23.4))

Use the equation method.

A Pharma company has recently recruited 4 scientists at an average age of 27 and is looking to develop quite a few pharmacological formulations. With a view to retain them the company proposes to offer a housing scheme to them on the following terms and conditions:

1. The number of beneficiaries will be four in number
2. The total cost of purchasing apartments will be Rs.1 crore
3. PNBHFL offers an 18 year term @ 9.00% interest and HDFC offers 15 years term @ 8% interest.
4. The company will pay the housing finance company on an installment basis.
5. A Down payment of 5% of the cost of the apartment has to be made and recoverable from the employee in 24 installments. The upfront payment will be made by the company.
6. In case of availing the loan from HDFC, 50% of the installment will be recovered from the employee on a monthly basis and in case of availing the loan from PNBHFL 45% will be recovered from the employee. The option of choosing the service rests with the company only.
7. Assume that employee deductions happen on the first day of the month and housing loan payments made by the company happens on the last day of the year.
8. The housing loan is offered on a fixed interest basis and EMI will not change.
9. Assume the individual apartments are of equal value.

You are called upon to do the following:

1. Calculate the two EMI options and choose the best one.

The following are option price quotations for The North West Company on July 27, 2019:

The North West Company stock market price $29.89

a. What is the intrinsic value and time value for each option?

b. Calculate the breakeven share price for each option.

c. Suppose on July 27, 2019 you take the long position (buy) in one August 16, 2019 call option on The North West Company and hold your position to the expiry date. Calculate your net profit given the following stock prices (Po) $ 20, 25, 30, 35, and 40.

d. Suppose on July 27, 2019 you take the short position (sell) in one August 16, 2019 put option on The North West Company and hold your position to the expiry date. Calculate your net profit given the following stock prices (Po) $ 20, 25, 30, 35, and 40.

Selected balance sheet account balances are: VIZQUEL COMPANY

December 31

2002 2001

Cash $ 200,000 $ 300,000

Accounts Payable 60,000 80,000

Accounts Receivable 180,000 140,000

Salaries Payable 12,000 6,000

Land 120,000 140,000

Merchandise Inventory 100,000 160,000

Prepaid Rent 50,000 45,000

Unearned Consulting Revenue 70,000 50,000

Income statement items for the year are:

Sales $800,000

Consulting Fees $200,000

Cost of Goods Sold 400,000

Salary Expense 90,000

Depreciation Expense 40,000

Rent Expense 100,000

1. Cash collections from customers during 2002 amounted to:

2. Cash received from consulting services during 2002 was:

3. Total cash collected amounted to:

4. Cash payments to suppliers for merchandise inventory during 2002 amounted to:

5. Cash payments for salary during 2002 amounted to:

6. Cash payments for rent during 2002 amounted to:

7. Cash payments for depreciation during 2002 amounted to:

8. Total cash paid for operating activities amounted to:

9. Cash from operating activities during 2002 is:

10. Net income for Vizquel Company for 2002 is:

A young connoisseur has $600 to spend to build a small wine cellar. She enjoys two vintages in particular: a 2001 French Bordeaux (F) at $40 per bottle and a less expensive 2005 California varietal wine (C) priced at $8 per bottle. Her utility is ?(?, ?) = ? 2/3? 1/3 . a. What is her expenditure function? b. What are the required expenditures to reach the maximized utility level under the original prices?

A physiological experiment was concluded to study the effect of various factors on a pulse rate. The participants took their own pulse. They then were asked to flip a coin. If their coin came up head, they were to run in place for 1 minute. Then everyone took their own pulse again. The dataset pulse.txt, available from Moodle, contains the following variables:
ROW- id numbers, from 1 to 92;

PULSE1- first pulse rate;

PULSE2- second pulse rate;

RAN-1=ran in place, 2 =did not run;

SMOKES-1=smokes regularly, 2=does not smoke regularly;

SEX-1=male, 2=female;

HEIGHT-height in inches;

WEIGHT-weight in pounds;

ACTIVITY-usual level of physical activity: 1=slight, 2=moderate, 3=a lot.

Use this data for the following questions.
(a) Find the histograms for pulse2, weight and height; Are they symmetrically distributed?

(b) Find the sample mean and sample standard deviation for pulse1.

(c) Construct a scatter plot between weight and height, categorized by male and female. What pattern have you observed?

Pulse.dat:

-----------------------------------------------------------------------------------------------------------------------------------------------------

1 64 88 1 2 1 66.00 140 2

2 58 70 1 2 1 72.00 145 2

3 62 76 1 1 1 73.50 160 3

4 66 78 1 1 1 73.00 190 1

5 64 80 1 2 1 69.00 155 2

6 74 84 1 2 1 73.00 165 1

7 84 84 1 2 1 72.00 150 3

8 68 72 1 2 1 74.00 190 2

9 62 75 1 2 1 72.00 195 2

10 76 118 1 2 1 71.00 138 2

11 90 94 1 1 1 74.00 160 1

12 80 96 1 2 1 72.00 155 2

13 92 84 1 1 1 70.00 153 3

14 68 76 1 2 1 67.00 145 2

15 60 76 1 2 1 71.00 170 3

16 62 58 1 2 1 72.00 175 3

17 66 82 1 1 1 69.00 175 2

18 70 72 1 1 1 73.00 170 3

19 68 76 1 1 1 74.00 180 2

20 72 80 1 2 1 66.00 135 3

21 70 106 1 2 1 71.00 170 2

22 74 76 1 2 1 70.00 157 2

23 66 102 1 2 1 70.00 130 2

24 70 94 1 1 1 75.00 185 2

25 96 140 1 2 2 61.00 140 2

26 62 100 1 2 2 66.00 120 2

27 78 104 1 1 2 68.00 130 2

28 82 100 1 2 2 68.00 138 2

29 100 115 1 1 2 63.00 121 2

30 68 112 1 2 2 70.00 125 2

31 96 116 1 2 2 68.00 116 2

32 78 118 1 2 2 69.00 145 2

33 88 110 1 1 2 69.00 150 2

34 62 98 1 1 2 62.75 112 2

35 80 128 1 2 2 68.00 125 2

36 62 62 2 2 1 74.00 190 1

37 60 62 2 2 1 71.00 155 2

38 72 74 2 1 1 69.00 170 2

39 62 66 2 2 1 70.00 155 2

40 76 76 2 2 1 72.00 215 2

41 68 66 2 1 1 67.00 150 2

42 54 56 2 1 1 69.00 145 2

43 74 70 2 2 1 73.00 155 3

44 74 74 2 2 1 73.00 155 2

45 68 68 2 2 1 71.00 150 3

46 72 74 2 1 1 68.00 155 3

47 68 64 2 2 1 69.50 150 3

48 82 84 2 1 1 73.00 180 2

49 64 62 2 2 1 75.00 160 3

50 58 58 2 2 1 66.00 135 3

51 54 50 2 2 1 69.00 160 2

52 70 62 2 1 1 66.00 130 2

53 62 68 2 1 1 73.00 155 2

54 48 54 2 1 1 68.00 150 0

55 76 76 2 2 1 74.00 148 3

56 88 84 2 2 1 73.50 155 2

57 70 70 2 2 1 70.00 150 2

58 90 88 2 1 1 67.00 140 2

59 78 76 2 2 1 72.00 180 3

60 70 66 2 1 1 75.00 190 2

61 90 90 2 2 1 68.00 145 1

62 92 94 2 1 1 69.00 150 2

63 60 70 2 1 1 71.50 164 2

64 72 70 2 2 1 71.00 140 2

65 68 68 2 2 1 72.00 142 3

66 84 84 2 2 1 69.00 136 2

67 74 76 2 2 1 67.00 123 2

68 68 66 2 2 1 68.00 155 2

69 84 84 2 2 2 66.00 130 2

70 61 70 2 2 2 65.50 120 2

71 64 60 2 2 2 66.00 130 3

72 94 92 2 1 2 62.00 131 2

73 60 66 2 2 2 62.00 120 2

74 72 70 2 2 2 63.00 118 2

75 58 56 2 2 2 67.00 125 2

76 88 74 2 1 2 65.00 135 2

77 66 72 2 2 2 66.00 125 2

78 84 80 2 2 2 65.00 118 1

79 62 66 2 2 2 65.00 122 3

80 66 76 2 2 2 65.00 115 2

81 80 74 2 2 2 64.00 102 2

82 78 78 2 2 2 67.00 115 2

83 68 68 2 2 2 69.00 150 2

84 72 68 2 2 2 68.00 110 2

85 82 80 2 2 2 63.00 116 1

86 76 76 2 1 2 62.00 108 3

87 87 84 2 2 2 63.00 95 3

88 90 92 2 1 2 64.00 125 1

89 78 80 2 2 2 68.00 133 1

90 68 68 2 2 2 62.00 110 2

91 86 84 2 2 2 67.00 150 3

92 76 76 2 2 2 61.75 108 2

Cash outflows to purchase available-for-sale securities on a long-term basis would be reported in the investing section of the cash flow statement.

Question 25 options:

Question 26 (1 point)

A cash flow statement starts with net income and adds (or deducts) items that did not affect cash to arrive at net cash provided by operating activities if the indirect method is used.

Question 26 options:

Question 27 (1 point)

Saved

The issue of bonds to acquire land would be shown in the financing section.

Question 27 options:

Question 28 (1 point)

If equipment was sold for $15,000 and a loss of $10,000 was recognized, investing activities would show an inflow of $15,000.

Question 28 options:

Question 29 (1 point)

Saved

Free cash flow is calculated by deducting cash used (provided) by investing activities from cash provided (used) by operating activities.

Question 29 options:

Question 30 (1 point)

Saved

A company has credit sales of $150,000 and cash sales of $90,000 during the same year that the Accounts Receivable account decreased by $20,000. What was the total cash received from customers?

Question 30 options:

Question 31 (1 point)

Cash inflows from investing activities include:

Question 31 options:

Question 32 (1 point)

Operating activities do not include cash flows

Question 32 options:

Question 33 (1 point)

Which of the following would decrease net cash provided by operating activities?

Question 33 options:

D’Lite Dry Cleaners is owned and operated by Joel Palk. A building and equipment are currently being rented, pending expansion to new facilities. The actual work of dry cleaning is done by another company at wholesale rates. The assets, liabilities, and common stock of the business on July 1, 2016, are as follows: Cash, $45,000; Accounts Receivable, $93,000; Supplies, $7,000; Land, $75,000; Accounts Payable, $40,000; Common Stock, $60,000. Business transactionsduring July are summarized as follows:

1.

During the first 13 weeks of the television season, the Saturday evening 8:00 P.M. to 9:00 P.M. audience proportions were recorded as ABC 30%, CBS 27%, NBC 25%, and independents 18%. A sample of 300 homes two weeks after a Saturday night schedule revision yielded the following viewing audience data: ABC 93 homes, CBS 63 homes, NBC 88 homes, and independents 56 homes. Test with  = .05 to determine whether the viewing audience proportions changed. Use Table 12.4.

Round your answers to two decimal places.

χ ² = ?

2.

With double-digit annual percentage increases in the cost of health insurance, more and more workers are likely to lack health insurance coverage (USA Today, January 23, 2004). The following sample data provide a comparison of workers with and without health insurance coverage for small, medium, and large companies. For the purposes of this study, small companies are companies that have fewer than 100 employees. Medium companies have 100 to 999 employees, and large companies have 1000 or more employees. Sample data are reported for 50 employees of small companies, 75 employees of medium companies, and 100 employees of large companies.

1. Conduct a test of independence to determine whether employee health insurance coverage is independent of the size of the company. Use  = .05. Use Table 12.4.
   
   Compute the value of the  ² test statistic (to 2 decimals).
   
   
   The p value is Selectless than .005between .005 and .01between .01 and .025between .025 and .05between .05 and .10greater than .10Item 2
   
   What is your conclusion?
   SelectConclude health insurance coverage is not independent of the size of the companyCannot reject the assumption that health insurance coverage and size of the company are independentItem 3
   
2. The USA Today article indicated employees of small companies are more likely to lack health insurance coverage. Calculate the percentages of employees without health insurance based on company size (to the nearest whole number).
   

   Small	%
   Medium	%
   Large	%