Problem 8-27 (Algo) Cash Collections; Cash Disbursements; Budgeted Balance Sheet [LO8-2, LO8-3, LO8-4, LO8-10]

Deacon Company is a merchandising company that is preparing a budget for the three-month period ended June 30th. The following information is available

Budgeting Assumptions:

1. 60% of sales are cash sales and 40% of sales are credit sales. Twenty percent of all credit sales are collected in the month of sale and the remaining 80% are collected in the month subsequent to the sale.

2. Budgeted sales for July are $235,000.

3. 10% of merchandise inventory purchases are paid in cash at the time of the purchase. The remaining 90% of purchases are credit purchases. All purchases on credit are paid in the month subsequent to the purchase. The accounts payable at March 31 will be paid in April.

4. Each month’s ending merchandise inventory should equal $10,000 plus 50% of the next month’s cost of goods sold.

5. Depreciation expense is $1,350 per month. All other selling and administrative expenses are paid in full in the month the expense is incurred.

Required:

1. Calculate the expected cash collections for April, May, and June.

2. Calculate the budgeted merchandise purchases for April, May, and June.

3. Calculate the expected cash disbursements for merchandise purchases for April, May, and June.

4. Prepare a budgeted balance sheet at June 30th. (Hint: You need to calculate the cash paid for selling and administrative expenses during April, May, and June to determine the cash balance in your June 30th balance sheet.)

The following information relates to the Ashanti Group of Companies for the year to 30 April 2020.

Additional Information:

Ashanti Ltd purchased 70% of the issued share capital of Bochem Ltd in 2000. At that time, the retained profits of Bochem amounted to $896,000.

Ashant Ltd purchased 60% of the issued share capital of Ceram Ltd in 2004. At that time, the retained profits of Ceram Ltd amounted to $320,000.

Sales from Ashanti to Bochem Ltd were $ 3 million during the post-acquisition period. Ashanti marks up all sales by 20%. At the reporting date this entire inventory remained in Bochem’s warehouse.

REQUIRED:

In so far as the information permits, prepare Fab Group of Companies’ Consolidated Income Statement for the year ended 30 April 2020 in accordance with IFRSs.   

An Analyst wants to know if there was a significance difference in the average of hours worked in a week from 2000 (Group 1) to 2004 (Group 2). He gathers all the data from the General Social Survey, and lists the following summary statistics from the sampling.

Source: General Social Survey (sda.berkeley.edu )

What is the correct null hypothesis?

Ho: mu2004-mu2000 < 0

Ho: mu2004-mu2000 does not equal 0

Ho: mu2000-mu2004 > 0

Ho: mu2004-mu2000 = 0

Medi Corp is a corporation that deals in the manufacturing of medical devices. It has just received a patent from the U.S. Patent and Trademark Office for one of its surgical robotic knee devices. The patent is for the purpose of use in full knee replacement surgeries, which was stated on the patent’s application. For part of the manufacturing process, Medi Corp uses Tech Co. to assemble the computer components that run the robot. Tech Co. is a computer company that manufactures a lot of the computer components for several medical device companies in the U.S.

Medi Corp has been considering making a bid to acquire Tech Co. If Medi Corp acquires Tech Co., the transaction would likely be around $100 million dollars. Tech Co. is one of only three companies in the U.S. that manufactures and assembles these computer components for medical devices, and is the biggest of the three companies that offer these services, with the other two companies several million in revenue behind Tech Co. Moreover, Medi Corp. is considered a leader in medical device manufacturing in the U.S. Both companies are publicly traded companies.

Tech Co.’s board of directors are willing to approve of a merger with Medi Corp. Rebecca is on the board of directors for Tech Co. She tells her husband that he should consider purchasing Medi Corp stock. Rebecca does not tell her husband any of the confidential information of the potential merger with Medi Corp., but her husband does know that she is on the board of directors at Tech Co. and that Medi Corp is a company Tech Co. does business with. Bob is an employee of Tech Co. He has been courted by Comp Inc., one of the competitors of Tech Co.

Bob has decided to leave Tech Co. for a senior placement at Comp Inc. At Tech Co., Bob works on the manufacturing of these computer components for Medi Corp. At Comp Inc., he will be in more of a management position, determining which companies Comp Inc. should be doing business with, and managing those employees that are in the manufacturing facilities.

Please answer the following question and provide legal reasoning:

If Medi Corp learns that Comp Inc. is releasing a robotic surgical device for hip replacement surgery that has similar technology to its surgical robotic knee devices, does it have any recourse against Comp Inc. for patent infringement? Please fully explain your answer as to what it must prove for this complaint against Comp Inc., and any defenses Comp Inc. has against this claim. Also explain if there could be any recourse against Bob directly if Bob had originally signed a confidentiality agreement with Tech Co. when he worked for them.

{THIS IS ALL THE INFORMATION AVAILABLE. IF THIS IS A REPEATED QUESTION FROM LEGAL STUDIES, WHERE CAN I FIND IT?}

Exercise 6-17 a1-a3 (Video)
Bonita Company reports the following for the month of June.

Date
Explanation
Units
Unit Cost
Total Cost
June 1       Inventory       200       $3           $600  
12       Purchase       400       6           2,400  
23       Purchase       400       7           2,800  
30       Inventory       50                      

Assume a sale of 500 units occurred on June 15 for a selling price of $8 and a sale of 450 units on June 27 for $9.

  
Calculate cost of goods available for sale.

The cost of goods available for sale      
$

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Calculate Moving-Average unit cost for June 1, 12, 15, 23 & 27. (Round answers to 3 decimal places, e.g. 2.525.)

June 1      
$
June 12      
$
June 15      
$
June 23      
$
June 27      
$

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Calculate the cost of the ending inventory and the cost of goods sold for each cost flow assumption, using a perpetual inventory system. (Round average-cost per unit to 3 decimal places, e.g. 12.520 and final answer to 0 decimal places, e.g. 1,250.)

FIFO
LIFO
Moving-Average Cost
The cost ending inventory      
$
$
$
The cost of goods sold      
$
$
$
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To test whether the mean time needed to mix a batch of material is the same for machines produced by three manufacturers, the Jacobs Chemical Company obtained the following data on the time (in minutes) needed to mix the material.

1. Use these data to test whether the population mean times for mixing a batch of material differ for the three manufacturers. Use = .05.
   
   Compute the values below (to 2 decimals, if necessary).

   Sum of Squares, Treatment
   Sum of Squares, Error
   Mean Squares, Treatment
   Mean Squares, Error

   
   
   Calculate the value of the test statistic (to 2 decimals).
   
   
   
   The p-value is Selectless than .01between .01 and .025between .025 and .05between .05 and .10greater than .10
   
   What is your conclusion?
   
   SelectConclude the mean time needed to mix a batch of material is not the same for all manufacturersDo not reject the assumption that mean time needed to mix a batch of material is the same for all manufacturers
   
2. At the = .05 level of significance, use Fisher's LSD procedure to test for the equality of the means for manufacturers 1 and 3.
   
   Calculate Fisher's LSD Value (to 2 decimals).
   
   
   
   What is your conclusion about the mean time for manufacturer 1 and the mean time for manufacturer 3?
   
   SelectCannot conclude there is a difference in the mean time for these manufacturersThese manufacturers have different mean times

Mars Dump is a multinational company that is caught by the Emissions Trading Scheme (ETS).

Details of ETS are as follows:

It is a cap and trade scheme in which permits are traded in an active market. Its annual compliance period is from 1 July of the current period to 30 June of the following year.

Each participating company receives an allocation of free permits each year based on their reporting carbon emissions from the previous period. In the case of Mars Dump Ltd, permits to emit 36 000 tonnes of carbon dioxide equivalents have been issued on the first day of the current period (i.e. 1 July 2019) when the market price of a permit was $25 per tonne of carbon dioxide equivalents.

During the 2019/2020 financial year, Mars Dump emitted 37 000 tonnes of carbon dioxide equivalents, which exceeded its permitted emissions of 36 000 tones. This occurred despite the managers of Mars Dump estimating that it had emitted 19 000 tonnes of carbon dioxide equivalents by 31 March 2020 and was therefore on target to emit 36 000 tonnes by 30 June 2020. The market price of a permit is $27 on 31 March 2020. As a result of exceeding allowed emission levels, on 30 June 2020, Mars Dump purchased 1 000 permits at a market price of $33 per tonne. Mars Dump uses the cost model in accordance with AASB 138, and amortises any deferred income arising from the permits using the proportion of actual emissions to estimated total emissions.

Required

1. How can stakeholder theory be used to explain companies voluntarily undertaking corporate social responsibility reporting? Discuss.                                                                            
2. “There is no mandatory reporting of corporate social responsibility in Australia.” What is your understanding of this phrase? Explain.                                                          
3. Account for above events in the books of Mars Dump Ltd for the period 1 July 2019 to 30 June 2020 in accordance with the requirements of Interpretation 3 and AASB138.                                                                                                                                                                     

Corporate Social Responsibility (CSR)

Mars Dump is a multinational company that is caught by the Emissions Trading Scheme (ETS).

Details of ETS are as follows:

It is a cap and trade scheme in which permits are traded in an active market. Its annual compliance period is from 1 July of the current period to 30 June of the following year.

Each participating company receives an allocation of free permits each year based on their reporting carbon emissions from the previous period. In the case of Mars Dump Ltd, permits to emit 36 000 tonnes of carbon dioxide equivalents have been issued on the first day of the current period (i.e. 1 July 2019) when the market price of a permit was $25 per tonne of carbon dioxide equivalents.

During the 2019/2020 financial year, Mars Dump emitted 37 000 tonnes of carbon dioxide equivalents, which exceeded its permitted emissions of 36 000 tones. This occurred despite the managers of Mars Dump estimating that it had emitted 19 000 tonnes of carbon dioxide equivalents by 31 March 2020 and was therefore on target to emit 36 000 tonnes by 30 June 2020. The market price of a permit is $27 on 31 March 2020. As a result of exceeding allowed emission levels, on 30 June 2020, Mars Dump purchased 1 000 permits at a market price of $33 per tonne. Mars Dump uses the cost model in accordance with AASB 138, and amortises any deferred income arising from the permits using the proportion of actual emissions to estimated total emissions.

Required

1. How can stakeholder theory be used to explain companies voluntarily undertaking corporate social responsibility reporting? Discuss.                                                                            
2. “There is no mandatory reporting of corporate social responsibility in Australia.” What is your understanding of this phrase? Explain.                                                          

Account for above events in the books of Mars Dump Ltd for the period 1 July 2019 to 30 June 2020 in accordance with the requirements of Interpretation 3 and AASB138.

prepare general journal entries on Dec 31 to record the following unrelated year end adjustments.

a. On October 1, the company received 4 months rent in advance from a tenant whose rent is $650 per month. The $2,000 was credited to the Unearned Rent account.

b.) The prepaid insurance account has a $5,200 debit balance before adjustment. An examination of insurance policies shows $800 of unexpired insurance.

c.) The company collects rent revenue monthly from its tenants. One tenant whose rent is $825 per month has not paid his rent for November and December.

d.) The prepaid Insurance account has a $3,700 debit balance before adjustment. An examination of insurance policies shows $1,050 of insurance expired.

e.) Estimated depreciation on a copy machine for the office for the year is $1,500.

f.) The company has four office employees who each earn $150 per day for a five day work week that ends on Friday. The employees were paid on Friday, Dec 27, and have worked full days on Monday and Tuesday, December 30 and 31