I. On January 1, Year 2017, Kennard Co. issued $2,000,000, 5%, 10-year bonds, with interest payable on June 30 and December 31 when the market rate of interest for similar bonds was 6%. Use the following format and round figures to nearest dollar.

1. Actual proceeds received from the issuance of the bonds

2. Prepare an amortization schedule for Year 1 and Year 2 using the effective interest rate method.

Date    Cash Paid    Interest Expense Amortization    Bond Carry Value

3. Show how this bond would be reported on the balance sheet at December 31, Year 2.

An 18-year-old man was admitted with multiple injuries after he and a passenger, another 18-year-old man, were in a motor vehicle accident. After receiving 50 mL of the first unit of blood, the patient developed shaking chills and became hypotensive. The unit of blood was immediately discontinued and the blood bank was asked to recheck the crossmatch STAT.

Laboratory Testing:

Clerical Check                          No evidence of blood bank clerical errors.

Hemoglobinemia                      Slight hemolysis observed

Pre-transfusion DAT                 Negative

Post-transfusion DAT               Weakly positive (mixed field)

Recheck of blood grouping

Recheck of Crossmatching       Patient pre-transfusion specimen and donor segment = compatible (IS)

                                               Patient post-transfusion specimen and donor segment = incompatible (IS)

Interpretation

What info do you gather from the test results and info given?

If 10-year T-bonds have a yield of 4.6%, 10-year corporate bonds yield 6.9%, the maturity risk premium on all 10-year bonds is 1.3%, and corporate bonds have a 0.15% liquidity premium versus a zero liquidity premium for T-bonds, what is the default risk premium on the corporate bond? (Express your answer as a percent and round your answer to two decimal places.)

5-year Treasury bonds yield 6.7%. The inflation premium (IP) is 2.13%, and the maturity risk premium (MRP) on 5-year T-bonds is 0.52%. There is no liquidity premium on these bonds. What is the real risk-free rate, r*? (Express your answer as a percent and round your answer to two decimal places)

Carla earns $100,000 per year now and pays $20,000 per year on her fixed-rate mortgage. Her income is subject to a COLA clause. If the risk-free rate of interest is 3%, and the expected inflation rate is 2% per year, what is the spending power of her net income in 10 years, expressed in today's dollars? And how would you find the present value of 10 years of Carla's income without being given an inflation rate or interest rate? HINT: Use market data to determine your answer.

Suppose America is able to produce up to 100,000 computers/year or 50,000 TVs/year or any linear combination of the two. Japan is able to produce up to 80,000 computers/year or 160,000 TVs/year or any linear combination of the two. Assume that without trade, each country spends half of their efforts on each good.

Which country has the absolute advantage in each good?

Which country has the comparative advantage in each good?

Suppose that each country specialized in producing one good and then agreed to trade 45,000 computers for 60,000 TVs. What would the gains from trade be for America?

Continuing with the supposition from #33, what would the gains from trade be for Japan?

Geraldine (Gerri) Bowen is a 74-year-old woman living with dementia. Her husband passed away one year ago. He was her primary care giver, although he had contracted for a daily caregiver to help Monday through Friday with Gerri’s activities of daily living and so that he could run errands such as banking, grocery shopping, etc. Since his death, the family (three sons and their wives) set up 24-hour care giving because Gerri wants to live at home and not in an extended care facility. Recently, Gerri had complained of abdominal discomfort and has frequent diarrhea. After some diagnostic tests (a lower GI, a CT and abdominal MRI) she was diagnosed with Stage 3 (late stage 3) colon cancer. In addition, Gerri has a right lower lobe lung lesion. The surgeon feels that it is most likely not metastasis, but a second primary cancer. The surgeon recommends palliative surgery, since Gerri will not benefit from radiation or chemotherapy. You are the nurse caring for Gerri after her colon resection and overhear the family discussing what they should be telling their mother. Gerri asks you, “no one is telling me what is going on. It’s not right. I don’t want to stay here (the hospital) I just want to be at home. I don’t like all these people around me.” You tell the oldest son that Gerri has asked questions about her condition on several occasions. He tells you that he and his brothers cannot agree whether Gerri should be told about her condition (the cancer). He advises you to tell Gerri that nothing is wrong. While two of the sons want their mother told, the third son feels it would be cruel to tell her because she isn’t completely “there”. Gerri recognizes her family and recalls the past all the time. She often has difficulty expressing her feelings and recalling the immediate past. But it is your opinion that she does understand some things.

What is the dilemma and relevant facts in this case? What ethical principles are pertinent to this case?

​(Financial statement​ analysis)  The annual sales for​ Salco, Inc. were$4.64million last year. The​ firm's end-of-year balance sheet was as​ follows Salco's income statement for the year was as​ follows:  

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

$1.01 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÷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$48,000 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?

Current assets   $500,000   Liabilities   $1,012,500
Net fixed assets   1,525,000   Owners' equity   1,012,500
Total Assets   $2,025,000   Total   $2,025,000

Sales    $4,640,000
Less: Cost of goods sold    (3,501,000)
Gross profit    $1,139,000
Less: Operating expenses    (507,000)
Net operating income    $632,000
Less: Interest expense    (94,000)
Earnings before taxes    $538,000
Less: Taxes (35%)    (188,300)
Net income    $349,700

a.  Calculate​ Salco's total asset​ turnover, operating profit​ margin, and operating return on assets.

The​ company's total asset turnover is

2.292.29

times.  ​(Round to two decimal​ places.)

The​ company's operating profit margin is

13.613.6​%.

​(Round to one decimal​ place.)

The​ company's operating return on assets is

31.231.2​%.

​(Round to one decimal​ place.)

b.  Salco plans to renovate one of its plants and the renovation will require an added investment in plant and equipment of

$1.01

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÷total

​assets) for Salco after the​ plant's renovation?

The​ company's new operating return on assets is

20.720.7​%.

​(Round to one decimal​ place.)

c . Given that the plant renovation in part

​(b​)

occurs and​ Salco's interest expense rises by

$48,000

per​ year, what will be the return earned on the common​ stockholders' investment?

The new return on​ owners' equity is

nothing​%.

​(Round to one decimal​ place.)

c.  Given that the plant renovation in part ​(b​)occurs and​ Salco's interest expense rises by $48,000 per​ year, what will be the return earned on the common​ stockholders' investment? The new return on​ owners' equity is nothing​%.​(Round to one decimal​ place.)

Mary-Lou is a 75-year-old widow, who lost her husband to cancer over a year ago. Her family and friends have noticed that she has been very teary, has low self-esteem and has lost interest in the things she used to love such as going to bingo with her friends and gardening. Her family initially put this down to the loss of her husband and thought it would pass with time. However, they are now getting really concerned as they have noticed that her mood is not improving still. When asked by her daughter if she is sleeping well, she says she has been drinking wine every night to help her go to sleep. It makes her feel happy and relaxed. What started as one glass a night has now increased to two or three glasses a night, and she has also started drinking during the day. Her daughter has noticed that her mum’s face always appears flushed and that she has had quite a few colds lately. Mary-Lou is also losing her balance and experiencing mood swings. Her daughter is worried that she is relying too heavily on alcohol and fears that she is starting to get short-term memory loss from the alcohol consumption. She has been forgetting things such as where she put her keys, whether she turned on the washing machine, why she opened the fridge and forgetting the topic of conversation when talking with her daughter on the phone. Mary-Lou has also been getting disorientated and getting lost when she goes out on her daily walks. A neighbor rang her daughter one day to tell her that she found Mary-Lou wandering around aimlessly, and when questioned what she was doing Mary-Lou snapped and said she was trying to get home. Her daughter decided it was time to take Mary-Lou to the local GP to work out what was going on with her. After listening to the signs and symptoms Mary-Lou was experiencing, the GP diagnosed her with depression and prescribed 50 mg of Fluoxetine/Prozac daily. Based on the results of clinical and radiological assessments, the GP determined that she had early onset Alzheimer’s disease. He prescribed a cholinesterase inhibitor and gave them information on support groups and tips on what to do from here on in. He also prescribed 10 mg of Diazepam daily to help with the withdrawals from alcohol abuse.

Question 4: Based on her clinical picture and history, explain if Mary-Lou suffers from alcohol addiction. Support your answer with relevant evidence from the case study.

0. Mary-Lou is a 75-year-old widow, who lost her husband to cancer over a year ago. Her family and friends have noticed that she has been very teary, has low self-esteem and has lost interest in the things she used to love such as going to bingo with her friends and gardening. Her family initially put this down to the loss of her husband and thought it would pass with time. However, they are now getting really concerned as they have noticed that her mood is not improving still. When asked by her daughter if she is sleeping well, she says she has been drinking wine every night to help her go to sleep. It makes her feel happy and relaxed. What started as one glass a night has now increased to two or three glasses a night, and she has also started drinking during the day. Her daughter has noticed that her mum’s face always appears flushed and that she has had quite a few colds lately. Mary-Lou is also losing her balance and experiencing mood swings. Her daughter is worried that she is relying too heavily on alcohol and fears that she is starting to get short-term memory loss from the alcohol consumption. She has been forgetting things such as where she put her keys, whether she turned on the washing machine, why she opened the fridge and forgetting the topic of conversation when talking with her daughter on the phone. Mary-Lou has also been getting disorientated and getting lost when she goes out on her daily walks. A neighbor rang her daughter one day to tell her that she found Mary-Lou wandering around aimlessly, and when questioned what she was doing Mary-Lou snapped and said she was trying to get home. Her daughter decided it was time to take Mary-Lou to the local GP to work out what was going on with her.

   After listening to the signs and symptoms Mary-Lou was experiencing, the GP diagnosed her with depression and prescribed 50 mg of Fluoxetine/Prozac daily. Based on the results of clinical and radiological assessments, the GP determined that she had early-onset Alzheimer’s disease. He prescribed a cholinesterase inhibitor and gave them information on support groups and tips on what to do from here on in. He also prescribed 10 mg of Diazepam daily to help with the withdrawals from alcohol abuse.

1. Explain the mechanism of action of two drug types Mary-Lou is prescribed with and describe how these drug actions help mitigate some of her symptoms. In you answer, make references to the pathophysiology of the relevant diseases.

Mary-Lou is a 75-year-old widow, who lost her husband to cancer over a year ago. Her family and friends have noticed that she has been very teary, has low self-esteem and has lost interest in the things she used to love such as going to bingo with her friends and gardening. Her family initially put this down to the loss of her husband and thought it would pass with time. However, they are now getting really concerned as they have noticed that her mood is not improving still. When asked by her daughter if she is sleeping well, she says she has been drinking wine every night to help her go to sleep. It makes her feel happy and relaxed. What started as one glass a night has now increased to two or three glasses a night, and she has also started drinking during the day. Her daughter has noticed that her mum’s face always appears flushed and that she has had quite a few colds lately. Mary-Lou is also losing her balance and experiencing mood swings. Her daughter is worried that she is relying too heavily on alcohol and fears that she is starting to get short-term memory loss from the alcohol consumption. She has been forgetting things such as where she put her keys, whether she turned on the washing machine, why she opened the fridge and forgetting the topic of conversation when talking with her daughter on the phone. Mary-Lou has also been getting disorientated and getting lost when she goes out on her daily walks. A neighbor rang her daughter one day to tell her that she found Mary-Lou wandering around aimlessly, and when questioned what she was doing Mary-Lou snapped and said she was trying to get home. Her daughter decided it was time to take Mary-Lou to the local GP to work out what was going on with her. After listening to the signs and symptoms Mary-Lou was experiencing, the GP diagnosed her with depression and prescribed 50 mg of Fluoxetine/Prozac daily. Based on the results of clinical and radiological assessments, the GP determined that she had early onset Alzheimer’s disease. He prescribed a cholinesterase inhibitor and gave them information on support groups and tips on what to do from here on in. He also prescribed 10 mg of Diazepam daily to help with the withdrawals from alcohol abuse.

a) Identify and explain two pharmacokinetic factors that are characteristic of/specific to Mary- Lou’s antidepressant medication. Discuss how her age impacts the pharmacokinetics of her medication.

b) Explain what specific considerations need to be made in the present scenario, when two drugs are administered simultaneously.