Common-Size Income Statements
Consider the following income statement data from the Ross Company:

Prepare common-size income statements for each year. Round percentages to one decimal point.

Common-Size Income Statements
Consider the following income statement data from the Ross Company:

Prepare common-size income statements for each year. Round percentages to one decimal point.

Bobby's sandwiches started business by acquiring $24,700 cash from the issue of common stock on January 1, Year 1. The cash acquired was immediately used to purchase equipment for $24,700 that had a $3,900 salvage value and an expected useful life of four years. The equipment was used to produce the following revenue stream (assume that all revenue transactions are for cash). At the beginning of the fifth year, the equipment was sold for $4,480 cash. Bobby uses straight-line depreciation.

Required
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.

Use Annualized Worth to determine best choice between these three.  I = 6% Show your work.

A     Planning horizon 10 years.   Initial Cost 50,000   annual maintenance costs 5000  annual revenue 40,000 salvage value 15000,

B   Planning horizon 8 years.    Initial Cost 75000

  annual maintenance cost   first year 5000  each year increases by 500.  

Annual revenue  first year 35000  each year increases 1000.  

Salvage value 18000.

C  Planning horizon 12 years   Initial cost 90,000

       Annual maintenance cost  first year 4000   each year increases 3000

       Annual Revenue   first year 65000   each year decreases 2000.

         Salvage value 16000

Use Annualized Worth to determine best choice between these three.  I = 6% Show your work.

A     Planning horizon 10 years.   Initial Cost 50,000   annual maintenance costs 5000  annual revenue 40,000 salvage value 15000,

B   Planning horizon 8 years.    Initial Cost 75000

  annual maintenance cost   first year 5000  each year increases by 500.  

Annual revenue  first year 35000  each year increases 1000.  

Salvage value 18000.

C  Planning horizon 12 years   Initial cost 90,000

       Annual maintenance cost  first year 4000   each year increases 3000

       Annual Revenue   first year 65000   each year decreases 2000.

         Salvage value 16000

Sections 4, 5 and 6 of the Income Tax Act 896 of 2015 mentions the sources of income as
employment, business and investment respectively. Section 133 under interpretation goes further to state that business includes; a trade, profession, vocation or isolated
arrangement with a business character but excludes employment.

Discuss what constitutes business income with reference to trade, profession and
vocation.

B. Under what circumstances would the Commissioner-General of Ghana Revenue
Authority may, by notice, require a person to file a tax return before the due date for
filing of tax returns?

C. The Ghana Revenue Authority Act, 2009 (Act 791) provides certain objectives to be
achieved by the Ghana Revenue Authority (GRA) in the performance of its functions.

Required: Identify FIVE functions that are to be performed by GRA to achieve its objectives.

Based upon market research, the Hawthorne Company has determined that consumers are willing to purchase 132 units of their portable media player each week when the price is set at $132.00 per unit. At a unit price of $40.50, consumers are willing to buy 315 units per week.

(a) Determine the weekly demand equation for this product, assuming price, p, and quantity, x, are linearly related.
p =  

(b) Determine the weekly revenue function.
R(x) =  

(c) Determine the number of units consumers will demand weekly when the price is $94.50 per portable media player.
units

(d) Determine the number of units consumers will demand weekly when the revenue is maximized.
units

(e) Determine the price of each unit when the revenue is maximized.
dollars

The total weekly cost (in dollars) incurred by Lincoln Records in pressing x compact discs is given by the following function.

C(x) = 2000 + 2x − 0.0001x²    (0 ≤ x ≤ 6000)

a. What is the actual cost incurred in producing the 991st and the 1971st disc?

b. What is the marginal cost when x = 990 and 1970?

Williams Commuter Air Service realizes a monthly revenue represented by the following function, where R(x) is measured in dollars and the price charged per passenger is x dollars.

R(x) = 9,600x − 120x²

a. Find the marginal revenue R'(x).

b. Compute the following values.

-R'(39)

-R'(40)

-R'(41)

c. Based on the results of part (b), what price (in dollars) should the airline charge in order to maximize their revenue?

Todd is trying to remember what he learned in introductory microeconomics, but he keeps getting confused. This thinking is as follows:

Firms produce where MR=MC, which means that the money they bring in (revenue) is equal to their costs. This is a little weird though because if revenue equals cost, the firm doesn’t make profit. Even though it doesn’t seem to match the real world, Todd thinks this may be correct because he learned that in perfect competition, firms make zero economic profit. Still, it seems that it would make more sense to produce where revenue is larger than cost and that way firms could make a profit?

In a few paragraphs, explain to Todd where he is going wrong. Be sure to correct all of his mistakes.