On January 1, 2018, the general ledger of 3D Family Fireworks includes the following account balances:
  

During January 2018, the following transactions occur:
  

The following information is available on January 31, 2018.

1. The company estimates future uncollectible accounts. The company determines $5,300 of accounts receivable on January 31 are past due, and 20% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
2. Supplies at the end of January total $850.
3. Accrued interest revenue on notes receivable for January. Interest is expected to be received each December 31.
4. Unpaid salaries at the end of January are $33,800.

Prepare a general journal including the closing entries for revenue and expenses. Also prepare an income statement, balance sheet, and

Enter your Accounts Receivable turnover value in one decimal place and Ratio of Allowance for Uncollectible Accounts in Whole number on an analysis table.

A publisher reports that 74 of their readers own a laptop. A marketing executive wants to test the claim that the percentage is actually different from the reported percentage. A random sample of 300 found that 70% of the readers owned a laptop. Is there sufficient evidence at the 0.05 level to support the executive's claim?

A. there is sufficient evidence to support the claim that the percentage of readers who own a laptop is different from 74%.

B.there is not enough sufficient evidence to support the claim that the percentage of readers who own a laptop is different from 74%.

Cavco Industries of Phoenix Arizona produces manufactured housing for the 21st century that rivals the construction and design elements found in traditional site built homes. In business for over 40 years Cavco sells manufactured homes, camping cabins, and park model homes under 400 square feet in size and commercial buildings. The company has several hundred floor plans to choose from or it can customize floor plans to fit the design specifications of the buyer. Sales have risen about 7% annually over the past 3 years.

Cavco relies on lean manufacturing and just in time inventory management techniques at its 3 manufacturing facilities. With thousands of stock keeping units direct materials inventory turns over every week. The most expensive inventory items consist of wood and wood products, steel, drywall abd petroleum based products. There are about 50 different stations in the main assembly lines. On Cavco's production floor. They are fed daily by subsidiary job shops close by such as the in house cabinet making shop and flooring shop. Nothing is ever made to stock so the bills of materials coming from independent dealer orders drive the release of direct materials onto the floor at each station in assembly.

At each plant the manager schedules production so tightly that there is rarely downtime at any station in an assembly line. Efficiency is so consistent that budgeted direct materials and direct manufacturing labor usually match the actual costs incurred at month end. Instead of computing a budgeted overhead allocation rate at the beginning of the year and adjusting at year end the company applies actual plant overhead. This consists of
1-Utilities
2-Engineering
3-Purchasing
4-Plant manager salaries

This is done each month so managers can see how they did and make adjustments before the next month's production activities get too far along. Once each home section is completed it is driven out of the plant by independent shippers title passes to the dealer sales revenue is booked and the home is taken to its destination. With no unsold finished goods in stock at month end the only materials to account for each month are those not yet released into production and those in work in process inventory.

QUESTION 1
Assume Cavco has dedicated one of its manufacturing plants to building camping cabins. Budgeted annual fixed manufacturing costs for this facility are $2,000,000 and include the items listed in the case. The amount will remain the same even though shifts per day and days worked per week may fluctuate. The master budget for 2006 is based on one shift production of 2 camping cabins per day over a 4 day work week. The plant is closed on Mondays for building and equipment maintenance. The company also shuts down production for one week in July and one week at the end of December. Normal capacity utilization is based on one shift production of 2 cabinets per day 5 days per week throughout the year. If every camping cabin built in this plant takes the same amount of time to complete what is the 2006 budgeted fixed manufacturing overhead cost rate per cabin under theoretical capacity, practical capacity, normal capacity utilization, and master budget capacity utilization?

Transactions to journalize: Karen Noonan opened Clean Sweep Inc. on February 1, 2019. During February, the following transactions were completed. Feb. 1 Issued 5,000 shares of Clean Sweep common stock for $13,000. Each share has a $1.50 par. 1 Borrowed $8,000 on a 2-year, 6% note payable. 1 Paid $9,020 to purchase used floor and window cleaning equipment from a company going out of business ($4,820 was for the floor equipment and $4,200 for the window equipment). 1 Paid $220 for February Internet and phone services. 1 Issued a 500,000 8% 5 year bond. Interest is payable July 1 and January 1 3 Purchased cleaning supplies for $980 on account. 4 Hired 4 employees. Each will be paid $480 per 5-day work week (Monday–Friday). Employees will begin working Monday, February 9. 5 Obtained insurance coverage for $9,840 per year. Coverage runs from February 1, 2019, through January 31, 2020. Karen paid $2,460 cash for the first quarter of coverage. 5 Discussions with the insurance agent indicated that providing outside window cleaning services would cost too much to insure. Karen sold the window cleaning equipment for $3,950 cash. 16 Billed customers $3,900 for cleaning services performed through February 13, 2019. 17 Received $540 from a customer for 4 weeks of cleaning services to begin February 21, 2019. (By paying in advance, this customer received 10% off the normal weekly fee of $150.) 18 Paid $300 on amount owed on cleaning supplies. 20 Paid $3 per share to buy 300 shares of Clean Sweep common stock from a shareholder who disagreed with management goals. The shares will be held as treasury shares. 23 Billed customers $4,300 for cleaning services performed through February 20. 24 Paid cash for employees’ wages for 2 weeks (February 9–13 and 16–20). 25 Collected $2,500 cash from customers billed on February 16. 27 Paid $220 for Internet and phone services for March. 28 Declared and paid a cash dividend of $0.20 per share. 28 Bought a $1,000 bond that pays 8% interest 28 Bought 5 shares of Jackson $5 par value common stock for $8 per share Adjusting entries 1. Services performed for customers through February 27, 2019, but unbilled and uncollected were $3,800. 2. Received notice that a customer who was billed $200 for services performed February 10 has filed for bankruptcy. Clean Sweep does not expect to collect any portion of this outstanding receivable. 3. Clean Sweep uses the allowance method to estimate bad debts. Clean Sweep estimates that 3% of its month-end receivables will not be collected. 4. Record 1 month of depreciation for the floor equipment. Use the straight-line method, an estimated life of 4 years, and $500 salvage value. 5. Record 1 month of insurance expense. 6. An inventory count shows $400 of supplies on hand at February 28. 7. One week of services were performed for the customer who paid in advance on February 17. 8. Accrue for wages owed through February 28, 2019. 9. Accrue for interest expense for 1 month. on the loan. 10. Accrued for interest on the bond.

Create t accounts

Create a trial balance

Enter adjusting journal entries

Update the t accounts

Create an adjusted trial balance

Create financial statements.

Create closing entries

Create post closing trial balance

Case Study: The Comic Book Publication Group (CBPG) specializes in creating, illustrating, writing, and printing various publications. It is a small but publicly traded corporation. CBPG currently has a capital structure of $12 million in bonds that pay a 5% coupon, $5 million in preferred stock with a par value of $35 per share and an annual dividend of $1.75 per share. The company has common stock with a book value of $6 million. The cost of capital associated with the common stock is 10%. The marginal tax rate for the firm is 33%. The management of the company wishes to acquire additional capital for operations purposes. The chief executive officer (CEO) and chief financial officer (CFO) agree that another public debt offering (corporate bonds) in the amount of $10 million would suffice. They believe that due to favorable interest rates, the company could issue the bonds at par with a 4% coupon. Before the Board of Directors convenes to discuss the debt Initial Public Offering (IPO), the CFO wants to provide some data for the board of directors’ meeting notebooks. One point of the analysis is to evaluate the debt offering’s impact on the company’s cost of capital. To do this: Solve for the current cost of capital of CBPG on a weighted average basis Solve for the new cost of capital, assuming the $10 million bond issued at par with a 4% coupon. Describe how you approached these calculations. Also discuss the tax shield advantage that debt capital provides, and briefly explain the cost of capital and WACC Provide a Table(s) to present answers (Students can transfer their EXCEL Table if utilized) Summarize findings Superior papers will explain the following elements when responding to the assignment questions: Provide narrative and solve for the current cost of capital of CBPG on a weighted average basis (WACC) Provide narrative and solve for the new cost of capital (WACC) Provide accurate WACC calculations for both scenarios Provide a Table(s) to present answers (there is a difference between performing calculations and presenting the supporting data and solved answers) Provide narrative on tax shield implications for both scenarios Provide narrative briefly explaining the cost of capital and WACC Provide a clear, logical conclusion

Case Study:

The Comic Book Publication Group (CBPG) specializes in creating, illustrating, writing, and printing various publications. It is a small but publicly traded corporation. CBPG currently has a capital structure of $12 million in bonds that pay a 5% coupon, $5 million in preferred stock with a par value of $35 per share and an annual dividend of $1.75 per share. The company has common stock with a book value of $6 million. The cost of capital associated with the common stock is 10%. The marginal tax rate for the firm is 33%.

The management of the company wishes to acquire additional capital for operations purposes. The chief executive officer (CEO) and chief financial officer (CFO) agree that another public debt offering (corporate bonds) in the amount of $10 million would suffice. They believe that due to favorable interest rates, the company could issue the bonds at par with a 4% coupon.

Before the Board of Directors convenes to discuss the debt Initial Public Offering (IPO), the CFO wants to provide some data for the board of directors’ meeting notebooks. One point of the analysis is to evaluate the debt offering’s impact on the company’s cost of capital. To do this:

• Solve for the current cost of capital of CBPG on a weighted average basis
• Solve for the new cost of capital, assuming the $10 million bond issued at par with a 4% coupon.
• Describe how you approached these calculations. Also discuss the tax shield advantage that debt capital provides, and briefly explain the cost of capital and WACC
• Provide a Table(s) to present answers (Students can transfer their EXCEL Table if utilized)

Summarize findings

Superior papers will explain the following elements when responding to the assignment questions:

• Provide narrative and solve for the current cost of capital of CBPG on a weighted average basis (WACC)
• Provide narrative and solve for the new cost of capital (WACC)
• Provide accurate WACC calculations for both scenarios
• Provide a Table(s) to present answers (there is a difference between performing calculations and presenting the supporting data and solved answers)
• Provide narrative on tax shield implications for both scenarios
• Provide narrative briefly explaining the cost of capital and WACC
• Provide a clear, logical conclusion

In 1993, Windsor Company completed the construction of a building at a cost of $2,160,000 and first occupied it in January 1994. It was estimated that the building will have a useful life of 40 years and a salvage value of $65,600 at the end of that time. Early in 2004, an addition to the building was constructed at a cost of $540,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $21,600. In 2022, it is determined that the probable life of the building and addition will extend to the end of 2053, or 20 years beyond the original estimate.

Hrubec Products, Inc., operates a Pulp Division that manufactures wood pulp for use in the production of various paper goods. Revenue and costs associated with a ton of pulp follow:

Hrubec Products has just acquired a small company that manufactures paper cartons. This company will be treated as a division of Hrubec with full profit responsibility. The newly formed Carton Division is currently purchasing 32,000 tons of pulp per year from a supplier at a cost of $24 per ton, less a 10% purchase discount. Hrubec’s president is anxious for the Carton Division to begin purchasing its pulp from the Pulp Division if an acceptable transfer price can be worked out.

Required:

For (1) and (2) below, assume the Pulp Division can sell all of its pulp to outside customers for $24 per ton.

1. What is the lowest acceptable transfer price from the perspective of the Pulp Division? What is the highest acceptable transfer price from the perspective of the Carton Division? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 32,000 tons of pulp next year?

2. If the Pulp Division meets the price that the Carton Division is currently paying to its supplier and sells 32,000 tons of pulp to the Carton Division each year, what will be the effect on the profits of the Pulp Division, the Carton Division, and the company as a whole?

For (3)–(5) below, assume that the Pulp Division is currently selling only 58,000 tons of pulp each year to outside customers at the stated $24 price.

3. What is the lowest acceptable transfer price from the perspective of the Pulp Division? What is the highest acceptable transfer price from the perspective of the Carton Division? What is the range of acceptable transfer prices (if any) between the two divisions? Are the managers of the Carton and Pulp Divisions likely to voluntarily agree to a transfer price for 32,000 tons of pulp next year?

4. If the Pulp Division does not meet the $20 price, what will be the effect on the profits of the company as a whole?

5. Refer to (4) above. Assume that due to inflexible management policies, the Carton Division is required to purchase 32,000 tons of pulp each year from the Pulp Division at $24 per ton. What will be the effect on the profits of the company as a whole?

A study was conducted to determine whether the final grade of a student in an introductory psychology course is linearly related to his or her performance on the verbal ability test administered before college entrance. The verbal scores and final grades for 10 students are shown in the table below.

Student 1 2 3 4 5 6 7 8 9 10

Score 65 42 32 43 59 73 31 25 74 71

Grade 79 63 85 93 93 79 86 74 67 92

Find the following: (a) The correlation coefficient: r=

(b) The least squares line: y^=

(c) The predicted grade for the eighth student:

(d) The residual for the eighth student:

The common stock of Texas Energy Company is selling at $90. A 1-year call option
written on Texas’s stock is selling for $8. The call’s exercise price is $100. The risk-free
interest rate is 1% per year. Suppose that puts on Texas stock are not tradable, but you
want to hold one. How would you do it? Suppose that puts are traded, what should a 1-
year put with an exercise price of $100 sell for?