I am graduating with MBA degree. What would you recommend as a "letter to a future student"?

QUESTION 5

The variable Z has a standard normal distribution. The probability P(- 0.5 < Z < 1.0) is:

QUESTION 6

If a random variable X is normally distributed with a mean of 30 and a standard deviation of 10, then P(X=20) =

QUESTION 7

If P( -z < Z < +z) = 0.8812, then the z-score is:

QUESTION 8

If the mean of a normal distribution is negative,

QUESTION 9

The starting salaries of individuals with an MBA degree are normally distributed with a mean of $90,000 and a standard deviation of $20,000. What is the probability that a randomly selected individual with an MBA degree will have a starting salary of at least $78,500?

1. 0.2810
2. 0.8840
3. 0.7190
4. 0.8210

QUESTION 10

The starting salaries of individuals with an MBA degree are normally distributed with a mean of $90,000 and a standard deviation of $20,000. What is the lowest salary for those individuals with an MBA degree whose starting salary is in the top 25 percent?

1. $104,500
2. $103,600
3. $83,750
4. $106,400

1. You graduated from Loyola two years ago, and you are now earning a salary of $50,000 per year. The total cost of your Loyola education was $200,000. You are now thinking about earning an MBA degree. Because of your excellent education at Loyola, you are eligible for the one-year, accelerated program at Global University, which has a cost of $120,000 for tuition, room, board, books, etc. To earn the MBA, you would have to quit your job and study full-time. As you are deciding what to do, your manager at work tells you that, based on your outstanding performance, you will be promoted in one month; the new position will carry a salary of $60,000 per year, or $10,000 more than you are earning now. You estimate that the MBA will translate into the following incremental after-tax earnings for the next ten years, which is your decision horizon:

       Incremental

Year                          After-tax Earnings

   1                                    $15,000

   2                                    20,000

   3                                    23,000

   4                                    26,000

   5                                    30,000

   6                                    35,000

   7                                    40,000

   8                                    50,000

   9                                    60,000

10                                    70,000

          You have a discount rate of 10.0%. Lastly, in order to get to/from class, you

          will need to spend more on transportation, and you will also have to eat

          several meals a week at fast food restaurants. These incremental net

          working capital costs will be $3,000 for the year. Your on-going fixed

overhead costs—for rent, clothes, insurance, food, etc.—are $20,000 per

year.

USING THE PRECEDING INFORMATION, PLEASE ANSWER THE

FOLLOWING QUESTIONS:

1. What is your

1. Sunk cost?
2. Fixed overhead cost?
3. Project cost?
4. Erosion?
5. Opportunity cost?
6. Incremental net working capital cost?

2. Combining all appropriate costs, what is the total cost of the MBA?
3. What is the present value of the incremental after-tax earnings?
4. What is the net present value of the MBA?
5. Should you pursue the MBA?
6. Should you factor in financing costs?
7. Should you factor in on-going fixed overhead costs?

Bensen Company began operations when it acquired $26,500 cash from the issue of common stock on January 1, 2018. The cash acquired was immediately used to purchase equipment for $26,500 that had a $4,500 salvage value and an expected useful life of four years. The equipment was used to produce the following revenue stream (assume all revenue transactions are for cash). At the beginning of the fifth year, the equipment was sold for $4,000 cash. Bensen uses straight-line depreciation:

Prepare income statements, statements of changes in stockholders’ equity, balance sheets, and statements of cash flows for each of the five years. Present the statements in the form of a vertical statements model.

Case 2
In early 2019, PT X acquired share ownership of 2 entities, namely PT Y and PT Z with
the following information:
• PT X acquired a 30% stake in PT Y, where previously PT X owned 40% of PT Y. Based on the analysis conducted by PT X, the additional 30% share ownership resulted PT X has control over PT Y.
• PT X acquired a 20% stake in PT Z, previously PT X owned 60% of PT Z. Based on the analysis conducted by PT X, on the initial ownership of 60% of PT Z's shares, PT X owns control of PT Z. With the additional 20% ownership of the shares, PT X has permanent ownership
has control over PT Z.
Towards the end of 2020, PT X sold part of its ownership to the two companies, with the following information:
• PT X sold 15% of its ownership in PT Y's shares. Based on the analysis conducted by PT X, the sale did not cause PT X to lose control of PT Y.
• PT X sold 40% of its ownership in PT Z's shares. Based on the analysis conducted by PT X, the sale caused PT X to lose control of PT Z.
Describe the accounting treatment for PT X for its ownership of PT Y and PT Z when:
1. Acquisition of additional shares in early 2019.
2. Sale of partial ownership towards the end of 2020.

Healthy Lifestyles

The Centers for Disease Control and Prevention (CDC) in Atlanta, Georgia, is the government agency responsible for disease-related issues in the United States. The CDC coordinates efforts to counteract outbreaks of diseases and funds a variety of medical and health research studies. The CDC also serves as a central clearinghouse for health-related data.

The CDC conducts the annual Behavioral Risk Factor Surveillance Survey. The survey measures a whole series of lifestyle characteristics that relate to health and longevity, such as smoking and use of seat belts. The survey compiles data on a stateby-state basis. Not all states are surveyed.

The data set from the 1990 Behavioral Risk Factor Surveillance Survey is on the accompanying CD in the file named HEALTHY. All numbers are percentages, and asterisks indicate the missing data for that state.

Your task is to prepare a summary of these data. Your report is to be issued to major news organizations, such as the Associated Press, and will appear in major newspapers around the United States. For this reason, it would be inappropriate to use technical jargon in your report.

Your boss has suggested a few general ideas about what is likely to appeal to your target audience. As you study the data, you might find other things worth including.

Questions

1. Report any interesting (i.e., unexpected, humorous, or odd) differences between states.

2. Devise a weighted index of all seven lifestyle variables. The weighted index is to serve as an overall or composite measure of healthy lifestyles. Apply your weight to the states of Minnesota, Florida, and California as an example of what your weighted index shows.

3. Discuss any noteworthy limitations of the survey or data set.

Bob is worried about his job security, and has started to venture into a new startup. Perhaps surprisingly, he is able to take his startup to IPO within a 5-year period (please allow me to dream). The firm has just announced its first dividend of $3/share and the firm’s dividend is expected to grow extremely fast for 4 years in a row at 30% each year. However, Bob expects that the company will only grow at 5% after that forever. Expected return (discount rate) for stocks is 12%. Please use the dividend discount model to price the stock at t=0.

You are CEO of SUNSUP Corporation, a major innovator and manufacturer of solar panels. As part of SUNSUPS’s commitment to social responsibility, you initiated and led, between 2013 and 2018, the financing of startup solar panel companies in 3rd world countries (with loans forgiven if the startup did not succeed).

By the end of 2018, about 2/3s of the startups have failed, but the other 1/3 appear to be commercially viable. Your Chief Financial Officer has advised you that, whatever its successes, this goodwill program has cut your company’s profit margin by about 15%. What are your ethical responsibilities under these circumstances?