Consider a ten-year bond with 5% coupon issued by Good Health Food Stores. The ten-year U.S. Treasury note yields 2.5%. Which of the following is correct?

1. If GHFS’s credit spread widens and the Treasury yield increases, the GHFS bond price will surely decline.
2. If GHFS’s credit spread widens and the Treasury yield decreases, the GHFS bond price may rise or decline, depending on the relative sizes of the changes.
3. If GHFS’s credit spread narrows and the Treasury yield increases, the GHFS bond price will surely rise.
4. If GHFS’s credit spread narrows and the Treasury yield increases, the GHFS bond price may rise or decline, depending on the relative sizes of the changes.
5. If GHFS’s credit spread narrows and the Treasury yield does not change, the GHFS bond price will surely rise.

A,B,D,E

I have the answers but can you please explain why they are

During all of Year 4, our company had 200,000 common shares outstanding.

During all of Year 4, there were 30,000 outstanding call options to buy common shares at $40 a share; and there were 20,000, $7, no par value, cumulative and convertible preferred shares outstanding. Each preferred share is convertible into three common shares.

During all of Year 4, we had outstanding $2,000,000 of 8% convertible bonds issued at face value. Each $1,000 bond is convertible into 20 common shares.

Year 4 net income was $750,000.

Instructions

Calculate basic and diluted earnings per share for Year 4. Prepare a schedule like we did in class and show all calculations for possible part marks.

Margo, a calendar year taxpayer, paid $580,000 for new machinery (seven-year recovery property) placed in service on August 1, 2017. Use Table 7-2. Assuming that the machinery was the only tangible property placed in service during the year, compute Margo’s maximum cost recovery deduction. How would your answer to part a change if the machinery was purchased in 2018 instead of 2017? COnsider section179, bonus and MACRS depreciation.

Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company’s income statement and balance sheets follow.

A 36-year-old man and his 32-year-old wife are undergoing an evaluation for fertility. A seminal fluid specimen is collected at home and brought to the lab for routine testing.

Color: Gray Volume: 4.5 mL liquefaction: 50 minutes

Viscosity: 0 (watery) Motility: 70%

Concentration: 15x106/mL Morphology: 70% normal

vitality: 60% Leukocytes: 0.8x106 cells/mL

1. List any abnormal or discrepant results.

2. Do any of the results obtained suggest improper specimen collection or laboratory error?

3. Are any of the results obtained associated with male infertility?

4. Based on these results, what chemical test should be performed to evaluate the functional integrity of the seminal vesicles and ejaculatory ducts?

An office building has the following investment characteristics: Year 1 NOI $2,100,000 Year 2 NOI $2,200,000 Year 3 NOI $2,300,000 Year 4 NOI $2,400,000 Initial (going in) cap rate 7% Loan Principal $18,000,000 Interest rate 5% Amortization 30 years Exit cap rate 8% Holding period 3 years Solve for each of the following:

Purchase price

Loan to value ratio

Annual debt service

Debt service coverage ratio for year 1

Loan balance at the end of year 3

Equity (Levered) IRR

Forten Company, a merchandiser, recently completed its calendar-year 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company’s income statement and balance sheets follow.

FORTEN COMPANY
Comparative Balance Sheets
December 31, 2017 and 2016

2017 2016

FORTEN COMPANY
Income Statement
For Year Ended December 31, 2017

Additional Information on Year 2017 Transactions

a. The loss on the cash sale of equipment was $15,125 (details in b).

b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash.

c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term note payable for the balance.

d. Borrowed $5,000 cash by signing a short-term note payable.

e. Paid $55,125 cash to reduce the long-term notes payable.

f. Issued 3,500 shares of common stock for $20 cash per share.

g. Declared and paid cash dividends of $52,100.

Required:

1. Prepare a complete statement of cash flows; report its operating activities using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

1. What is the firm's current year net profit margin?

2. What is the firm's net income for the current year?

3. What is the firm's current year operating profit margin?

4. What is the firm's current year gross profit margin?

5. What is the entry for the current year's interest expense on a common-sized income statement?

Question:

Baltimore Manufacturing Company just completed its year ended December 31, 2018. Depreciation for the year amounted to $190,000: 25% relates to sales, 20% relates to administrative facilities, and the remainder relates to the factory. Of the total units produced during FY 2016: 75% were sold in 2018 and the rest remained in finished good inventory. Use this information to determine the dollar amount of the total depreciation that will be contained in Cost of Goods Sold.  (Round dollar values & enter as whole dollars only.)

Baltimore Manufacturing had a Work in Process balance of $73,000 on January 1, 2018. The year end balance of Work in Process was $87,000 and the Cost of Goods Manufactured was $600,000. Use this information to determine the total manufacturing costs incurred during the fiscal year 2018. (Round dollar values & enter as whole dollars only.)

Annapolis Clothing Company manufactures quality boating attire. The following selected financial information for the fiscal year 2018 is provided:

Item

Amount

Sales

$200,000

Cost of Goods Manufactured

51,000

Direct Material Purchased

80,000

Factory Overhead

20,000

Work in Process - January 1

60,000

Work in Process - December 31

30,000

Direct Material - December 31

20,000

Finished Goods Inventory - December 31

34,000

Net Income

30,000

Direct Materials used

60,000

Cost of Goods Sold

67,000

Use this information to determine the dollar amount of Annapolis Clothing's Finished Goods Inventory for January 1, 2018. (Round dollar values & enter as whole dollars only.)

Your Answer:

During FY 2018 Bay Manufacturing had total manufacturing costs are $444,000. Their cost of goods manufactured for the year was $455,000. The January 1, 2019 balance of Work-in-Process Inventory is $42,000. Use this information to determine the dollar amount of the FY 2018 beginning Work-in-Process Inventory. (Round dollar values & enter as whole dollars only.)

Frederick Company's January 1, 2018 finished goods inventory was $82,000. The January 1, 2019 finished goods inventory is $99,000.  Cost of goods manufactured for the FY 2018 was $389,000. Use this information to determine the dollar amount of the FY 2018 cost of goods sold. (Round dollar values & enter as whole dollars only.)

Annapolis Company manufactures quality boating apparel. The following selected financial information for the fiscal year 2018 is provided:

Item

Amount

Sales

$850,000

Beginning Raw Material Inventory

74,000

Direct Material Purchased

308,000

Factory Overhead

90,000

Finished Goods Inventory - January 1

144,000

Work in Process - January 1

74,000

Work in Process - December 31

98,000

Ending Raw Material Inventory

58,000

Finished Goods Inventory - December 31

168,000

Net Income

65,000

Direct Labor

155,000

Cost of Goods Sold

655,000

Use this information to prepared a detailed Schedule of Costs of Goods Manufactured for FY 2018: (Round dollar values & enter as whole dollars only. Properly title your statement.)

Annapolis Company manufactures quality boating apparel. The following selected financial information for the fiscal year 2018 is provided:

Item

Amount

Sales

$850,000

Beginning Raw Material Inventory

74,000

Direct Material Purchased

308,000

Factory Overhead

90,000

Finished Goods Inventory - January 1

144,000

Work in Process - January 1

74,000

Work in Process - December 31

98,000

Ending Raw Material Inventory

58,000

Finished Goods Inventory - December 31

168,000

Net Income

65,000

Direct Labor

155,000

Cost of Goods Sold

655,000

Use this information to prepared a detailed Schedule of Costs of Goods Manufactured for FY 2018: (Round dollar values & enter as whole dollars only. Properly title your statement.)

Alaska Corporation purchased, on account, 6,600 pounds of raw materials at $7.50 per pound on January 2, 2019. The production manager requisitioned and received 2,350 pounds of raw material into production on January 15. Use this information to prepare the General Journal entries (without explanation) for January 2 and January 15. If no entry is required then write "No Entry Required."

Baltimore Company uses a job order cost system and applies overhead based on estimated rates. The overhead application rate is based on total estimated overhead costs of $280,000 and direct labor hours of 25,000. During the month of February 2019, Job 2-1 incurred direct labor of 450 hours. Use this information to prepare the end of the month application General Journal entry (without explanation) of factory overhead for Job 2-1 for the month. If no entry is required then write "No Entry Required."

During March 2019, Virginia Bay Corporation recorded $275,000 of costs related to factory overhead. Alpha's overhead application rate is based on direct labor hours. The preset formula for overhead application estimated that $267,000 would be incurred, and 6,800 direct labor hours would be worked. During March, 11,000 hours were actually worked. Use this information to determine the standard overhead rate. (round & enter any final dollar answers to the nearest cent):

During March 2019, Alaska Corporation recorded $254,000 of costs related to factory overhead. Alaska's overhead application rate is based on direct labor hours. The preset formula for overhead application estimated that $250,000 would be incurred, and 12,500 direct labor hours would be worked. During March, 13,500 hours were actually worked. Use this information to determine the amount of overhead over or under applied. Enter overapplied overhead as a negative number. (round & enter any final dollar answers to the nearest whole dollar)

On March 31, 2019, Dorchester Corporation recorded the following factory overhead costs incurred:

           Factory Manager Salary                 $5,500

           Factory Utilities                                 2,800

           Machinery Deprecation           9,000

           Machinery Repairs               1,800

           Factory Rent                     2,000

The overhead application rate is based on direct labor hours. The preset formula for overhead application estimated that $22,000 would be incurred, and 2,000 direct labor hours would be worked. During March, 650 hours were actually worked on Job Order 3-1 and 1,200 hours were actually worked on Job Order 3-2. Use this information to prepare the March 31 General Journal entries, without explanations, for the: (round any final dollar answers to the nearest whole dollar):

           1. to record the factory overhead costs

           2. the allocation of factory overhead to Job Order 3-1

           3. the allocation of factory overhead to Job Order 3-2

           4. the adjusting entry to dispose of any over or under application of factory overhead

March 1, 201, Dorchester Company's beginning work in process inventory had 8,000 units. This is its only production department. Beginning WIP units were 50% complete as to conversion costs. Dorchester introduces direct materials at the beginning of the production process. During March, all beginning WIP was completed and an additional 15,500 units were started and completed. Dorchester also started but did not complete 7,500 units. These units remained in ending WIP inventory and were 70% complete as to conversion costs. Dorchester uses the weighted average method. Use this information to determine for March 2019 the equivalent units of production for conversion costs. (Round & enter final answers to: the nearest whole dollar for total dollar answers, nearest penny for unit costs or nearest whole number for units)

Dorchester Company, on March 1, 2019 has a beginning Work in Process inventory of zero. All materials are added into production at the beginning of its production. There is only one production WIP inventory. On March 1, Dorchester started into production 14,500 units. At the end of the month there were 13,000 units completed and transferred into the Finished Goods Inventory. The ending WIP was 65% complete with respect to conversion. For the month of March the following costs were incurred and recorded in the WIP:

            Direct Material                      $11,000

            Direct Labor               22,000

            Factory Overhead          15,000

Dorchester uses the weighted-average process costing method. Use this information to determine the cost per equivalent unit of conversion for the month of March: (Round & enter final answers to the nearest cent.)

Your Answer: