The fallout from the financial crisis of 2008 included an overheated real estate market, fueled by home purchase incentives, poor lending practices, and securitization through high-risk, mortgage-backed securities, which led to a near collapse of global capital markets. As a consequence, many have argued that if the financial institutions had been required to report their loans (and loan-backed investments) at fair value instead of cost, large losses would have been reported earlier. This would have signaled regulators to the problems in the mortgage markets and therefore minimized the losses to U.S. taxpayers.

Explain how reported accounting numbers might affect an individual’s perceptions and actions. Cite two examples.

In 2018, Caterpillar Inc. had about 665 million shares outstanding. Their book value was $37.0 per share, and the market price was $152.80 per share. The company’s balance sheet shows that the company had $28.50 billion of long-term debt, which was currently selling near par value.

a. What was Caterpillar’s book debt-to-value ratio? (Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.)

b. What was its market debt-to-value ratio? (Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.)

c. Which measure should you use to calculate the company’s cost of capital?

In 2018, Caterpillar Inc. had about 655 million shares outstanding. Their book value was $30.0 per share, and the market price was $158.30 per share. The company’s balance sheet shows that the company had $17.80 billion of long-term debt, which was currently selling near par value. a. What was Caterpillar’s book debt-to-value ratio? (Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.) b. What was its market debt-to-value ratio? (Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.) c. Which measure should you use to calculate the company’s cost of capital?

A cinema knows near a university knows that there are two types of consumers: regular people and students. Ordinary people have an aggregate demand curveof? = 10−p/3 while students have an aggregate demand curve of? = 10–2p/3. The marginal cost of the cinema is zero.

a) Suppose students can be separated from other people by their student id, and the cinema charges each group of consumers a different price. What prices would the cinema charge?

b) Suppose the cinema cannot price discriminate. What would be the market price and quantity sold to each group of customers?

c) How much does the cinema gain from price discrimination?

Please show the process to the solution

Briefly explain how different types of cost allocation methods like Physical measure (Physical units) method, Sales value at split off method, Net Realizable Value (NRV) method and constant gross margin percentage NRV method of Management Accounting can be applied to education industry while allocating overhead cost among different cost objects. Give an example by taking the values arbitrarily (real data not required). 1st explain different cost objects or departments to allocate costs and then allocate using these 4 methods.

1. Use the following information from Dell Enterprise to answer the questions.
   

1. Using the Conventional Method, what is the Cost-to-Retail Ratio for 2010? Round to the nearly whole percentage.
2. Using the Conventional Method, what is the ending inventory valued at Cost for 2010?
3. Using the LIFO Retail Method, what is the Cost-to-Retail Ratio for 2010?

1. An agency billed $9 million in media and $1 million in production. The agency received a 13.5% commission on media and a 15% commission on production billing.

• What were the agency’s revenues from its media billing?
• What were the agency’s total revenues?
• What percentage comes from media?

2. The Net cost of a newspaper ad is $8,500. If your agency commission is 15%, find the gross cost of the ad?

Costco can purchase a bag of Starbucks coffee for $24.00 less discounts of 20%, 15%, and 7%. It then adds a 40% markup on cost. Expenses are known to be 25% of the regular unit selling price.

a. What is the cost of the coffee?

b. What is the regular unit selling price?

c. How much profit will Costco make on a bag of Starbucks coffee?

d. What markup on selling price percentage does this represent?