Memo 1

To:                       Pricing Manager, Tri-State Region

From:                  Regional Vice President, Tri-State Region

Re:                       Revenue from EPIX

We recently added the EPIX Movie Channels as part of a new tier of programming for our digital video subscribers. The EPIX channels are sold as an add-on package for $9.75 per month, but we would like to potentially increase our revenue from our subscriber base. Currently we have about 15,059 subscribers, generating monthly revenue of $146,823.

Some have suggested we should cut price, as customers tend to be fairly price sensitive for add-on packages. However, in this case, if we lower price for our new subscribers; we really need to cut it to all of our existing subscribers as well. I have some concerns that lowering price will be counter-productive.

The marketing department calculated some subscription levels at various price points in this region, and I need you to perform the analysis. Specifically, I want you to estimate the price sensitivity of customers at the current price. Please address the following questions: (1) If we lower the price, do you think this is likely to lead to higher revenue, and (2) how much potential revenue can we generate and how low should we go with our price?

Thanks for your help.

1.The yearly salary (in thousands of dollars) for a small company are listed below. Find the mode, mean, median and population standard deviation and use the Empirical Rule to find a 95% confidence interval.

74 46 397 75 98 67 46 96

2. From the Measures of Central Tendencies computed above, which one would you use to represent the “average” company salary. Explain your reasoning.

Record the following transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1.

(a) Started business by issuing 10,000 shares of common stock for $30,000.
(b) Hired Rebecca as an administrative assistant, promising to pay her $2,900 every two weeks.
(c) Rented a building for three years at $570 per month and paid six months' rent in advance.
(d) Purchased equipment for $5,000 cash.
(e) Purchased $1,900 of supplies on account.
(f) Provided services to customers for $7,200 cash.
(g) Paid employees’ salaries, $5,800.
(h) Paid for supplies purchased in item (e).
(i) Paid $810 for current advertising in a local newspaper.
(j) Paid utility bill of $1,200 for the current month.

2. A company provides services to customers on account, $4,900.

3. A company collects $5,100 cash from customers for services previously provided on account.

4. A company purchases a building for $200,000, paying $29,000 cash and signing a note payable for the remainder.

Outline the rationale for and benefits of a publicly funded health service.  

Based on the requirements of the Sarbanes-Oxley Act and SEC reporting requirements for publically traded companies,

Write a four to five (4-5) page paper in which you:

Assess the roles of the Board of Directors and Chief Executive Officer of a public company for establishing an ethical environment that generates quality accounting and reliable financial reporting for use by shareholders and investors. Provide support for your assessment.

Recommend a strategy for a CEO to implement, leading to an ethical environment that leads to high-quality accounting, reporting, and forecasting. Provide support for your recommendation.

Suggest how corporate management can provide assurances to investors that the performance forecast and expected earnings will be realized, minimizing the volatility of the stock price. Provide support for your suggestions.

Evaluate the consequences to a publically traded company when there is a lack of quality within financial accounting and reporting, indicating how these consequences may be minimized. Provide support for your answer.

Assess the requirements of the Sarbanes-Oxley Act related to accounting quality, indicating whether or not you believe the requirements are sufficient to protect stockholders and potential investors. Provide support for your position.

The unadjusted trial balance of the Dairy Plus Company as of December 31, 2017 is found on the trial balance tab. The following information is required to prepare the necessary adjusting entries for the Dairy Plus Company.

1) The balance in Prepaid insurance represents a 24-month policy that went into effect on December 1, 2017. Review the unadjusted balance in Prepaid insurance, and prepare the necessary adjusting entry, if any.

2) Based on a physical count, supplies on hand total $4,050. Review the unadjusted balance in Supplies, and prepare the necessary adjusting entry, if any.

3) The equipment is expected to have a 4-year useful life, and be worth about $10,000 at the end of four years. Review the unadjusted balance in Accumulated depreciation, and prepare the necessary adjusting entry to record the monthly depreciation, if any.

4) On December 26, the client paid a $13,800 60-day fee in advance, covering December 27 to February 24. Review the unadjusted balance in Unearned Consulting Revenue, and prepare the necessary adjusting entry, if any.

5) Dairy Plus's employee earns $120 per day for a five-day workweek beginning on Monday and ending on Friday. The employee was last paid on Friday, December 26. Review the unadjusted balance in Salaries expense, and prepare the necessary adjusting entry, if any.

6) In the second week of December, Dairy Plus agreed to provide 30 days of consulting services to a local fitness club for a fixed fee of $5,820. The terms of the initial agreement call for Dairy Plus to provide services from December 12, 2017, through January 10, 2018, or 30 days of service. The club agrees to pay Dairy Plus $5,820 on January 10, 2018, when the service period is complete. Review the unadjusted balance in Consulting revenue, and prepare the necessary adjusting entry, if any.

Unadjusted

I want the general journal answers.

The unadjusted trial balance of the Home Perfection Company as of December 31, 2017 is found on the trial balance tab. The following information is required to prepare the necessary adjusting entries for the Home Perfection Company.

• 1) The balance in Prepaid insurance represents a 24-month policy that went into effect on December 1, 2017. Review the unadjusted balance in Prepaid insurance, and prepare the necessary adjusting entry, if any.

• 2) Based on a physical count, supplies on hand total $4,500. Review the unadjusted balance in Supplies, and prepare the necessary adjusting entry, if any.

• 3) The equipment is expected to have a 4-year useful life, and be worth about $9,000 at the end of four years. Review the unadjusted balance in Accumulated depreciation, and prepare the necessary adjusting entry to record the monthly depreciation, if any.

• 4) On December 26, the client paid a $8,400 60-day fee in advance, covering December 27 to February 24. Review the unadjusted balance in Unearned Consulting Revenue, and prepare the necessary adjusting entry, if any.

• 5) Home Perfection's employee earns $150 per day for a five-day workweek beginning on Monday and ending on Friday. The employee was last paid on Friday, December 26. Review the unadjusted balance in Salaries expense, and prepare the necessary adjusting entry, if any.

• 6) In the second week of December, Home Perfection agreed to provide 30 days of consulting services to a local fitness club for a fixed fee of $3,660. The terms of the initial agreement call for Home Perfection to provide services from December 12, 2017, through January 10, 2018, or 30 days of service. The club agrees to pay Home Perfection $3,660 on January 10, 2018, when the service period is complete. Review the unadjusted balance in Consulting revenue, and prepare the necessary adjusting entry, if any.

Section 1: Using marginal analysis to determine the profit maximizing price and quantity of resources in a factor market under perfect

Orange Inc. sells cell phones in a perfectly competitive market in the short-run. Capital and labor are two resource factors used to produce the cell phones. Capital is fixed in the short-run but labor can vary. The market for hiring labor is a perfectly competitive market.

Labor is measured in worker weeks. Each worker week costs $700 of wages and Orange Inc. can hire any number of worker weeks. Each cell phone is sold at a price of $300 and can sell any number of phones that are produced. Information is given below on various amounts of labor and output.

Table 1:

Step 1

Using the information preceding Table 1 and the table, create a separate table that includes the following for each quantity of labor value: marginal product of labor, total revenue, marginal revenue, marginal revenue product of labor, total variable cost, marginal cost, total resource cost, and marginal resource cost.

The table can be computer-generated or created by hand. Be sure to appropriately label the table so the various calculated values can be identified. Round off to two decimal places for the dollar values.

Step 2

Using the table you created in Step 1, create a graph that illustrates the profit maximizing level of output price and output quantity for the company using marginal analysis.

The graph can be computer-generated or created by hand. Indicate the profit maximizing output quantity and output price in this graph.

Step 3

Using the table you created in Step 2, create a graph that illustrates the profit maximizing level of input price and input quantity for the company using marginal analysis.

The graph can be computer-generated or created by hand. Indicate the profit maximizing input quantity and input price in this graph.

Step 4

In a short paragraph (100 to 200 words), indicate the profit for Orange Inc. (assuming the company maximizes profit) using the information you calculated in the table for Step 1. In addition, explain how the optimal input and optimal output decisions for Orange Inc. are equivalent

Bob Fuji began business on January 1, 2018 with a Balance Sheet that listed $ 300,000 of Cash and $ 300,000 of Shareholders' Equity.  During 2018, the following inventory related transactions took place:

Produced 15,000 units of inventory @ a cost of $ 20 per unit

Delivered 12,000 units of inventory to customers with a selling price of $ 28 per unit

Collected $ 280,000 of cash related to 10,000 units of inventory

The above transactions were the only transactions for the firm, and the "year-end" selling price of inventory is $ 28.

D. (3)    If Bob Fuji recognizes revenue at the Completion of Production, Total Assets on

          Bob Fuji's December 31, 2018 Balance Sheet will be equal to $ _____________

E. (4)    If Bob Fuji recognizes revenue at the Time of Cash Collection, Total Assets on

          Bob Fuji's December 31, 2018 Balance Sheet will be equal to $ _____________

F. (3)   _____    Assume that (other than collecting the amount of money that he was

                        owed at the end of 2018) in 2019, the only activity of Bob Fuji is that he

                        "liquidates" any remaining inventory, receiving cash in the amount of

                       $ 25 per unit.  

G. If Bob recognizes revenue at "Time of Cash Collection", which of the following items will be GREATER than $ 0 on Bob Fuji's 2019 Income Statement?

                        A. Revenue

                        B. Net Income

                        C. Both A and B

                        D. None of the above    

Business Plan

I have chosen the mortgage industry with my main company being Quicken Loans. For my market domain I will be focusing on mortgage origination and servicing. The main reason I selected this market is I have been employed with a mortgage servicing company for the last 8 years and have gained significant knowledge operationally of how important this industry is to all customers. I am looking forward to evaluating this market and gaining additional knowledge in this industry. I have seen the progression from the crash of the mortgage industry in 2006 where it clearly showed how important it is as it almost pushed the U.S. economy into a recession. The mortgage industry has a long history of highs and lows and I believe I will be able to accurately identify SOWT within this industry. With an ever-changing world the mortgage industry has to continue to shift and balance revenue opportunities vs. regulatory compliance directives.

While doing my research I will be using resources such as S&P Global Ratings Research, Harvard Business, Housing Wire, FITCH rating agency data, US News, etc. I believe the challenges I will face with researching this market is the enormous amount of news reports and data that do not fully represent the facts accurately. I also believe due to this being such a large market and the amount of change that has occurred good and bad there is a lot of data to work through. A main focus within this market I will be using is going to be digital transformation and how Quicken loans has embraced this with their consumer base to not only increase productivity, but also provide an easier streamlined approach for consumers. The world is now different and the majority of people use cell phones, electronic funds transfer, online accounts, etc. Quicken loans is using this technology to enhance the consumer experience.

As part of researching the mortgage industry and Quicken Loans I will also be discussing companies who were not as fortunate and made mistakes which led to their ultimate closing such as Thornburg Mortgage LLC who was effected by the subprime mortgage crisis in 2007 which forced them to file chapter 11 bankruptcy in 2009 and lead to multiple investigations of the founders.

Question: Please provide substantive feedback on the above market domain selection. Please also provide references if used