CASE : Manuel Market opens first branch in Riyadh
Manuel Market, a Jeddah-based supermarket retailer, opened its first branch in Riyadh on Feb. 26, 2020.
The ninth and newest Manuel Market, located in Riyadh-Mercato, Prince Muqrin bin Abdul Aziz Street, An-Nuzhah district, aims to provide customers a luxurious shooping experience, the best service, and the finest healthy, natural and organic products at reasonable prices. The opening ceremony was attended by Khaled Al-Darwish, CEO of Manuel Market; Abdulelah Al-Darwish, chairman; Abdullah Al-Darwish; Abdulrazzaq Al-Darwish, general manager; Faisal Al-Darwish, deputy general manager; a group of businessmen and media representatives; and a gathering of Manuel’s customers.
The supermarket chain, which opened its first branch in Jeddah
in 2010, currently has seven branches in Jeddah, one in Jubail and
one in the Saudi capital.
CEO Al-Darwish said: “The Manuel Market chain offers the best and
widest selection of consumer goods and food products of the most
famous global brands. In addition to being a leader in the field of
organic and healthy natural foods, Manuel provides its customers
with outstanding national and international product options under
one roof.”
One of the most important goals of Manuel, Al-Darwish said, is to
“make a positive difference in people’s lives by paying attention
to their passion, understanding their needs, and meeting their
aspirations.” He also reiterated Manuel’s commitment to developing
and improving service levels to meet the demands of its
customers.
Question: Suggest your strategies to differentiate Manuel Market from other super markets in Riyadh
In: Operations Management
A company purchased a piece of equipment for $40,000 on January 1, 2018. At that time the company estimated the equipment would have a 6-year useful life and no salvage value. The company used straight-line depreciation based on this information used through 2019. On December 31, 2020, the company determined the equipment instead has a 9-year useful life, with no salvage value. The company's tax rate has been 20% since 2015. What is the necessary adjustment to beginning retained earnings in 2020 for this change?
In: Accounting
A company purchased a piece of manufacturing equipment for $30,000 on January 1, 2018. At that time, the company estimated the equipment would have a 7-year useful life and no salvage value. The company used straight-line depreciation based on this information through 2019. On December 31, 2020, the company determined the equipment instead has a 10-year useful life, with no salvage value. The company’s tax rate has been 30% since 2015.
What is the necessary adjustment to beginning retained earnings in 2020 for this change?
In: Accounting
Ewig Berhad acquired 800, 000 out of the 1, 000, 000 RM1 ordinary shares of Leben Berhad on 1 January 2020 for RM900, 000 cash. The general reserves and retained earnings of Leben Berhad at the date of acquisition were RM400, 000 and RM250, 000 respectively.
Required:
(a) What is the percentage of acquisition by Ewig Berhad?
(b) What is the corporate relationship in this situation?
(c) Based on MFRS 10, briefly explain whether Ewig Berhad exercises control over Leben Berhad.
(d) Assuming the proportional net asset method is used, what is the fair value of the NCI?
(e) What is the goodwill or bargain purchase?
In: Accounting
In January 1, 2015, Springfield Company acquired an 80% interest in Lincoln Company for a purchase price that was $350,000 over the book value of Lincoln’s Stockholders’ Equity on the acquisition date. Spring uses the equity method to account for its investment in Lincoln. Springfield assigned the acquisition-date AAP as follows:
|
AAP Items |
Initial Fair Value |
Useful Life (years) |
|
Patent |
200,000 |
10 |
|
Goodwill |
150,000 |
Indefinite |
|
$350,000 |
Lincoln sells inventory to Springfield (upstream) which includes that inventory in products that it (Springfield), ultimately, sells to customers outside of the controlled group. You have compiled the following data as of 2020 and 2021:
|
2020 |
2021 |
|
|
Transfer price for inventory sale |
$ 305,500 |
$ 356,500 |
|
Cost of goods sold |
(269,500) |
(316,500) |
|
Gross profit |
$ 36,000 |
$ 40,000 |
|
% inventory remaining |
25% |
35% |
|
Gross profit deferred |
$ 9,000 |
$ 14,000 |
|
EOY Receivable/Payable |
$ 55,000 |
$ 65,000 |
The inventory not remaining at the end of the year has been sold outside of the controlled group.
Springfield and Lincoln report the following financial statements at December 31, 2021:
|
Income Statement |
||
|
Springfield |
Lincoln |
|
|
Sales |
$ 5,660,000 |
$ 1,160,000 |
|
Cost of goods sold |
(3,830,000) |
(687,500) |
|
Gross Profit |
1,830,000 |
472,500 |
|
Income (loss) from subsidiary |
185,600 |
|
|
Operating expenses |
(1,045,200) |
(215,500) |
|
Net income |
$ 970,400 |
$ 257,000 |
|
Statement of Retained Earnings |
||
|
Springfield |
Lincoln |
|
|
BOY Retained Earnings |
$6,464,800 |
$2,385,000 |
|
Net income |
970,400 |
257,000 |
|
Dividends |
(105,400) |
(25,000) |
|
EOY Retained Earnings |
$7,329,800 |
$2,617,000 |
|
Balance Sheet |
||
|
Springfield |
Lincoln |
|
|
Assets: |
||
|
Cash |
$ 978,400 |
$ 474,200 |
|
Accounts receivable |
1,142,300 |
702,700 |
|
Inventory |
1,515,400 |
622,900 |
|
Equity Investment |
2,571,200 |
|
|
PPE, net |
5,934,800 |
1,802,300 |
|
$12,142,100 |
$3,602,100 |
|
|
Liabilities and Stockholders’ Equity: |
||
|
Current Liabilities |
$ 689,700 |
$ 204,600 |
|
Long-term Liabilities |
2,054,000 |
379,500 |
|
Common Stock |
853,600 |
92,100 |
|
APIC |
1,215,000 |
308,900 |
|
Retained Earnings |
7,329,800 |
2,617,000 |
|
$12,142,100 |
$3,602,100 |
|
Required:
a. Compute the EOY non-controlling interest equity balance.
b. Prepare the consolidation spreadsheet on the acquisition date.
In: Accounting
In January 1, 2015, Springfield Company acquired an 80% interest in Lincoln Company for a purchase price that was $350,000 over the book value of Lincoln’s Stockholders’ Equity on the acquisition date. Spring uses the equity method to account for its investment in Lincoln. Springfield assigned the acquisition-date AAP as follows:
|
AAP Items |
Initial Fair Value |
Useful Life (years) |
|
Patent |
200,000 |
10 |
|
Goodwill |
150,000 |
Indefinite |
|
$350,000 |
Lincoln sells inventory to Springfield (upstream) which includes that inventory in products that it (Springfield), ultimately, sells to customers outside of the controlled group. You have compiled the following data as of 2020 and 2021:
|
2020 |
2021 |
|
|
Transfer price for inventory sale |
$ 305,500 |
$ 356,500 |
|
Cost of goods sold |
(269,500) |
(316,500) |
|
Gross profit |
$ 36,000 |
$ 40,000 |
|
% inventory remaining |
25% |
35% |
|
Gross profit deferred |
$ 9,000 |
$ 14,000 |
|
EOY Receivable/Payable |
$ 55,000 |
$ 65,000 |
The inventory not remaining at the end of the year has been sold outside of the controlled group.
Springfield and Lincoln report the following financial statements at December 31, 2021:
|
Income Statement |
||
|
Springfield |
Lincoln |
|
|
Sales |
$ 5,660,000 |
$ 1,160,000 |
|
Cost of goods sold |
(3,830,000) |
(687,500) |
|
Gross Profit |
1,830,000 |
472,500 |
|
Income (loss) from subsidiary |
185,600 |
|
|
Operating expenses |
(1,045,200) |
(215,500) |
|
Net income |
$ 970,400 |
$ 257,000 |
|
Statement of Retained Earnings |
||
|
Springfield |
Lincoln |
|
|
BOY Retained Earnings |
$6,464,800 |
$2,385,000 |
|
Net income |
970,400 |
257,000 |
|
Dividends |
(105,400) |
(25,000) |
|
EOY Retained Earnings |
$7,329,800 |
$2,617,000 |
|
Balance Sheet |
||
|
Springfield |
Lincoln |
|
|
Assets: |
||
|
Cash |
$ 978,400 |
$ 474,200 |
|
Accounts receivable |
1,142,300 |
702,700 |
|
Inventory |
1,515,400 |
622,900 |
|
Equity Investment |
2,571,200 |
|
|
PPE, net |
5,934,800 |
1,802,300 |
|
$12,142,100 |
$3,602,100 |
|
|
Liabilities and Stockholders’ Equity: |
||
|
Current Liabilities |
$ 689,700 |
$ 204,600 |
|
Long-term Liabilities |
2,054,000 |
379,500 |
|
Common Stock |
853,600 |
92,100 |
|
APIC |
1,215,000 |
308,900 |
|
Retained Earnings |
7,329,800 |
2,617,000 |
|
$12,142,100 |
$3,602,100 |
|
Required:
a. Compute the EOY non-controlling interest equity balance.
b. Prepare the consolidation spreadsheet on the acquisition date.
In: Accounting
Traxonia Railroad Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance, using income from operations as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31, 2016:
| Revenues—East | $ 878,000 |
| Revenues—West | 1,042,000 |
| Revenues—Central | 1,880,000 |
| Operating Expenses—East | 563,600 |
| Operating Expenses—West | 619,680 |
| Operating Expenses—Central | 1,172,940 |
| Corporate Expenses—Shareholder Relations | 155,000 |
| Corporate Expenses—Customer Support | 333,000 |
| Corporate Expenses—Legal | 233,100 |
| General Corporate Officers’ Salaries | 278,500 |
The company operates three service departments: Shareholder Relations, Customer Support, and Legal. The Shareholder Relations Department conducts a variety of services for shareholders of the company. The Customer Support Department is the company’s point of contact for new service, complaints, and requests for repair. The department believes that the number of customer contacts is an activity base for this work. The Legal Department provides legal services for division management. The department believes that the number of hours billed is an activity base for this work. The following additional information has been gathered:
|
East |
West |
Central |
|
|---|---|---|---|
| Number of customer contacts | 4,500 | 5,500 | 8,500 |
| Number of hours billed | 1,350 | 2,100 | 2,100 |
| Required: | |
| 1. | Prepare quarterly income statements showing income from operations for the three divisions. Use three column headings: East, West, and Central. |
| 2. | Identify the most successful division according to the profit margin. |
| 3. | What would you include in a recommendation to the CEO for a better method for evaluating the performance of the divisions? |
In: Accounting
Question 6 Part a:
Which of the following are examples of genetic drift?
A) founder effect
B) natural selection
C) bottleneck effect
D) migration
Group of answer choices
A. Both A) and B) are examples of genetic drift
B. both B) and D) are examples of genetic drift
C. Both A) and C) are examples of genetic drift
D. all of these are examples of genetic drift
________________________________________________________________________________
Question 6 Part b:
Which of the following causes changes to populations that are beneficial?
A) founder effect
B) natural selection
C) sexual selection
D) migration
Group of answer choices
A. Both A) and C) are examples of genetic drift
B. both C) and D) are examples of genetic drift
C. Both A) and B) are examples of genetic drift
D. B) and C) causes changes that are beneficial
E. all of these are things that cause beneficial traits
In: Biology
|
First and Ten Corporation’s stock returns have a covariance with the market portfolio of .0456. The standard deviation of the returns on the market portfolio is 19 percent and the expected market risk premium is 7.1 percent. The company has bonds outstanding with a total market value of $55.8 million and a yield to maturity of 6 percent. The company also has 5 million shares of common stock outstanding, each selling for $43. The company’s CEO considers the firm’s current debt-equity ratio optimal. The corporate tax rate is 23 percent and Treasury bills currently yield 3.4 percent. The company is considering the purchase of additional equipment that would cost $53 million. The expected unlevered cash flows from the equipment are $17.6 million per year for 5 years. Purchasing the equipment will not change the risk level of the firm. |
|
Calculate the NPV of the project. |
In: Finance
1. We have two potential designs for the homepage of our website, but we don’t know which one to use. The CEO likes one, and the CRO (Chief Revenue Office) likes another. Half the company likes one, and the other half of the company likes the other. Which one should we use?
2. Let's say you have an Excel spreadsheet with 10,000 leads from a few months back -- long enough that those leads' sales cycle has passed. The file contains information about each lead, like their industry, title, company size, and what they did to become a lead (like downloading an ebook). Also in the file is whether they closed as a customer and how much their order was for. Can you use this information to create a lead score? How would you do it?"
In: Operations Management