Horizon Corporation manufactures personal computers. The company began operations in 2012 and reported profits for the years 2012 through 2019. Due primarily to increased competition and price slashing in the industry, 2020’s income statement reported a loss of $20 million. Just before the end of the 2021 fiscal year, a memo from the company’s chief financial officer (CFO) to Jim Fielding, the company controller, included the following comments:

“If we don’t do something about the large amount of unsold computers already manufactured, our auditors will require us to record a write-down. The resulting loss for 2021 will cause a violation of our debt covenants and force the company into bankruptcy. I suggest that you ship half of our inventory to J.B. Sales, Inc., in Oklahoma City. I know the company’s president, and he will accept the inventory and acknowledge the shipment as a purchase. We can record the sale in 2021 which will boost our loss to a profit. Then J.B. Sales will simply return the inventory in 2022 after the financial statements have been issued.”

What is the effect on income before taxes of the sales transaction requested by the CFO? If Jim does not record the sales transaction requested by the CFO, what is the effect on total assets and income before taxes of the inventory write-down?

At 1/1/2020, you take out a mortgage loan of $233,000. Your mortgage broker informs you that you can borrow the rest using a 20-year mortgage at an effective annual interest rate of 5%, with monthly compounding and constant monthly payments.

You may ignore all taxes and fees for the entirety of this problem. Note that today is t = 0 and after you buy the house you will make the first payment one month from now (t = 1).

1. a) Calculate the monthly payment on your home.

2. b) How much of your 1st payment goes toward paying down principal? How much goes toward

   paying interest?

3. c) How much of your 60th payment goes toward paying down principal? How much goes toward

   paying interest?

4. d) What is the present value of remaining principal balance after you make your 60th payment

   (at t = 60)?

Now, suppose you just make your 60th payment. There are still 180 payments remaining. Now, the Federal Reserve announces that the market interest rate is reset to 0%. However, you are still facing the same payment schedule.

e) At the new discount rate of 0%, what is the present value of your remaining payments?

At 1/1/2020, you take out a mortgage loan of $233,000. Your mortgage broker informs you that you can borrow the rest using a 20-year mortgage at an effective annual interest rate of 5%, with monthly compounding and constant monthly payments.

You may ignore all taxes and fees for the entirety of this problem. Note that today is t = 0 and after you buy the house you will make the first payment one month from now (t = 1).

1. a) Calculate the monthly payment on your home.

2. b) How much of your 1st payment goes toward paying down principal? How much goes toward

   paying interest?

3. c) How much of your 60th payment goes toward paying down principal? How much goes toward

   paying interest?

4. d) What is the present value of remaining principal balance after you make your 60th payment

   (at t = 60)?

Now, suppose you just make your 60th payment. There are still 180 payments remaining. Now, the Federal Reserve announces that the market interest rate is reset to 0%. However, you are still facing the same payment schedule.

e) At the new discount rate of 0%, what is the present value of your remaining payments?

Find three articles describing the role technology will play in addressing the challenges ahead in long-term care. Summarize your findings and based on your learning, respond to the following questions:

·      Which challenges in long-term care system remain unmet? Why?

·      What changes can we expect to occur with the influx of baby boomers entering into the long-term care system? Why do you think technology is important to long-term care? Support your answer with relevant examples

.What are the pros and cons of the implementation of technology in long-term care? Consider both providers and consumers while describing.

·      How does technology improve the type and quality of care received by long-term care consumers? How important is the commitment by top management for the use of information technology in long-term care to be successful? Why?

How can the challenges be proactively addressed as opposed to being reactive?

Marginal costs of abatement may different across firms due to

a.different aged technology across firms

b.different raw material used in the production process

c.different outputs being produced

d.all of the above

Technology standards provide an incentive for entrepreneurs in the area of pollution control to develop new ideas.

a.True

b.False

Emissions standards provide no incentive to innovate in terms of pollution control technology.

a.True

b.False

Output based standards provide incentive to innovate by reducing

a.emissions per unit of input

b.inputs used per unit of output

c.overall level of output

d.both of the first two answers

Technology forcing

a.increases the incentive for polluters to influence politicians to delay the onset of regulations

b.is designed to motivate the pollution control industry to invent new ways to meet environmental standards

c.is the idea of setting standards that are unrealistic given current levels of technology

d.all of the above

1. The following table provides data related to the production technology of a firm that use only two inputs – labor and capital – to produce output. Both inputs are variable.

1. Keeping capital on the y-axis and labor on the x-axis, draw an isoquant map for the firm’s production technology (At least 3 isoquant maps)
2. Does this production technology exhibit diminishing marginal returns to labor? Justify your answer.
3. Does this production technology exhibit diminishing marginal returns to capital? Justify your answer.
4. Does this production technology exhibit diminishing MRTS? Justify your answer.

Suppose that the MD = 5E and with its current technology, the firm’s MAC is given by MAC1 = 200 – 5E.

a) Determine the socially optimal level of emissions E.

b) Determine the emissions tax that would achieve the socially optimal level of emissions. Now suppose the firm can adopt a new technology that changes is MAC to New MAC2 = 160 – 4E Calculate change in costs for the firm from adopting the new technology when:

c) The government uses an emissions standard equal to your answer in (a) above

d) The government uses an emissions tax equal to your answer in (b) (Assume no change to standard or tax rate after the change in technology)

Now suppose the government adjusts the standard and/or the tax such that MD = New MAC. Calculate the change in total costs for the firm from adopting the new technology when:

e) The government adjusts the standard, and

f) The government adjusts the tax rate

Suppose that the MD = 5E and with its current technology, the firm’s MAC is given by
MAC1 = 200 – 5E.
a) Determine the socially optimal level of emissions E.
b) Determine the emissions tax that would achieve the socially optimal level of emissions.
Now suppose the firm can adopt a new technology that changes is MAC to
New MAC2 = 160 – 4E
Calculate change in costs for the firm from adopting the new technology when:
c) The government uses an emissions standard equal to your answer in (a) above
d) The government uses an emissions tax equal to your answer in (b)
(Assume no change to standard or tax rate after the change in technology)
Now suppose the government adjusts the standard and/or the tax such that MD = New MAC. Calculate the change in total costs for the firm from adopting the new technology when:
e) The government adjusts the standard, and
f) The government adjusts the tax rate

Need help with part e and f

Suppose that the MD = 5E and with its current technology, the firm’s MAC is given by MAC1 = 200 – 5E.

a) Determine the socially optimal level of emissions E.

b) Determine the emissions tax that would achieve the socially optimal level of emissions.

Now suppose the firm can adopt a new technology that changes is MAC to New MAC2 = 160 – 4E Calculate change in costs for the firm from adopting the new technology when:

c) The government uses an emissions standard equal to your answer in (a) above

d) The government uses an emissions tax equal to your answer in (b) (Assume no change to standard or tax rate after the change in technology)

Now suppose the government adjusts the standard and/or the tax such that MD = New MAC. Calculate the change in total costs for the firm from adopting the new technology when:

e) The government adjusts the standard, and

f) The government adjusts the tax rate

Bandung Corporation began 2020 with a $46,000 balance in the deferred tax liability account. At the end of 2020, the related cumulative temporary difference amounts to $350,000 and it will reverse evenly over the next 2 years. Pretax accounting income for 2020 is $525,000, the tax rat for all years is 20%, taxable income for 2020 is $405,000.

a) Compute income taxes payable for 2020

b) Prepare the journal entry to record income tax expense, deferred income taxes, and income tax payable for 2020

c) Prepare the income tax expense section of the income statement for 2020 beginning with the line "Income before income tax"