Smith Family

• Single male
• Paid $900 in alimony last year
• No kids
• Earned $37,500 last year from FT job
• Earned $3,000 from PT job
• Rents an apartment for $600/mth
• Spent $500 on moving expenses for a new job
• Paid $2,400 in federal income taxes through his paychecks
• Paid $700 in interest on a student loan
• Gave $500 to a local for profit soccer team for new uniforms
• Bought a new car with a $2,000 down payment
• Contributed $3,000 to a Roth IRA last year

1. What is the Smith family Gross Income?
2. What is the Smith Family AGI?
3. What would the standard deduction be for the Smith family?
4. What is the total of itemized deductions the Smith family can use?
5. How much of the soccer donation can the Smith family claim?
6. What is the Taxable income for the Smith family?
7. How much will the Smiths owe/get in refund for their tax return?
8. What is the average tax rate for the Smith family?

5 year ago, the bond issuer issued a 30-year 7% semiannual bond when the market interest rate was 6%. 5 years later, the interest rate changes to 8%, so what is the rate of return for this bond for the last 5 years?

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, 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, 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.

Stuart Manufacturing Company started operations on January 1, Year 1. During Year 1, the company engaged in the following transactions.

1. Issued common stock for $84,000.

2. Paid $29,000 cash to purchase raw materials used to make products.

3. Transferred $21,000 of raw materials to the production department.

4. Paid $31,500 cash for labor used to make products.

5. Paid $51,000 cash for overhead costs (assume actual and estimated overhead are the same).

6. Finished work on products that cost $79,000 to make.

7. Sold products that cost $66,000 to make for $91,000 cash.

Required

1. Prepare the December 31, Year 1, balance sheet.

2. Prepare the December 31, Year 1, income statement.

The annual sales for Salco, Inc. were $4.57 million last year. The firm's end-of-year balance sheet was as follows:

Current assets

$509,000

Liabilities

$997,000

Net fixed assets

1,485,000

​Owners' equity

997,000

Total Assets

$1,994,000

Total

$1,994,000

Salco's income statement for the year was as follows:

Sales

$4,570,000

​Less: Cost of goods sold

(3,492,000)

Gross profit

$1,078,000

​Less: Operating expenses

\(503,000)

Net operating income

$575,000

​Less: Interest expense

(97,000)

Earnings before taxes

$478,000

​Less: Taxes

​(35%​)

(167,300)

Net income

$310,700

a. Calculate Salco's total asset turnover, operating profit margin, and operating return on assets. b. Salco plans to renovate one of its plants and the renovation will require an added investment in plant and equipment of $1.03 million. The firm will maintain its present debt ratio of 50 percent when financing the new investment and expects sales to remain constant. The operating profit margin will rise to 13.5 percent. What will be the new operating return on assets ratio (i.e., net operating income divided by ÷total assets) for Salco after the plant's renovation? c. Given that the plant renovation in part (b ) occurs and Salco's interest expense rises by $52,000 per year, what will be the return earned on the common stockholders' investment? Compare this rate of return with that earned before the renovation. Based on this comparison, did the renovation have a favorable effect on the profitability of the firm?

Consider the following table containing unemployment rates for a 10-year period.

What is the coefficient of determination for the regression model? Round your answers to two decimal places.

One year ago Lerner and Luckmann Co. issued 15-year, noncallable, 7.3% annual coupon bonds at their par value of $1,000. Today, the market interest rate on these bonds is 5.5%. What is the current price of the bonds, given that they now have 14 years to maturity? Select the correct answer.

a. $1,172.61

b. $1,176.61

c. $1,174.61

d. $1,170.61

e. $1,178.61

Please, show all the steps. Thank you.

Deidoro Company has provided the following data for maintenance cost:

Maintenance cost is a mixed cost with variable and fixed components. The fixed and variable components of maintenance cost are closest to:

Multiple Choice

$34,300 per year; $.714 per machine hour

$600 per year; $.714 per machine hour

$600 per year; $1.400 per machine hour

$31,400 per year; $1.400 per machine hour

.

Derst Inc. sells a particular textbook for $38. Variable expenses are $30 per book. At the current volume of 59,000 books sold per year the company is just breaking even. Given these data, the annual fixed expenses associated with the textbook total:

Multiple Choice

$472,000

$2,242,000

$2,714,000

$1,770,000