The balances in the accounts of Maybe Ltd at 30 June 2019 and 30 June 2020 are:

Other information:

Share capital is increased by the bonus issue of 24 000 shares for $1.00 each out of retained earnings. Plant is acquired during the period at a cost of $36 000, while plant with a carrying amount of $nil (cost of $24 000, accumulated depreciation of $24 000) is scrapped.

Required:

a)      Reconstruct the allowance for doubtful debts and accounts receivable.

(6.5 marks)

b)      Reconstruct inventory and accounts payable

c)      Reconstruct accrued salaries

d)      Reconstruct property, plant and equipment and accumulated depreciation

e) present a statement of cash flow for maybe ltd for the year ended 30 June 2020

The property, plant, and equipment section of the Jasper Company’s December 31, 2020, balance sheet contained the following:

The land and building were purchased at the beginning of 2016. Straight-line depreciation is used and a residual value of $31,000 for the building is anticipated.

The equipment is comprised of the following three machines:

The straight-line method is used to determine depreciation on the equipment. On March 31, 2021, Machine 102 was sold for $39,000. Early in 2021, the useful life of machine 101 was revised to five years in total, and the residual value was revised to zero.

Required:

1. Calculate the accumulated depreciation on the equipment at December 31, 2020.
2. Prepare the journal entry to record 2021 depreciation on machine 102 up to the date of sale.
3. Calculate the gain or loss on the sale of machine 102.
4. Prepare the journal entry for the sale of machine 102.
5. Prepare the 2021 year-end journal entries to record depreciation on the building and remaining equipment.

The property, plant, and equipment section of the Jasper Company’s December 31, 2020, balance sheet contained the following:

The land and building were purchased at the beginning of 2016. Straight-line depreciation is used and a residual value of $31,000 for the building is anticipated.

The equipment is comprised of the following three machines:

The straight-line method is used to determine depreciation on the equipment. On March 31, 2021, Machine 102 was sold for $39,000. Early in 2021, the useful life of machine 101 was revised to five years in total, and the residual value was revised to zero.

Required:

1. Calculate the accumulated depreciation on the equipment at December 31, 2020.
2. Prepare the journal entry to record 2021 depreciation on machine 102 up to the date of sale.
3. Calculate the gain or loss on the sale of machine 102.
4. Prepare the journal entry for the sale of machine 102.
5. Prepare the 2021 year-end journal entries to record depreciation on the building and remaining equipment.

The property, plant, and equipment section of the Jasper Company’s December 31, 2020, balance sheet contained the following:

The land and building were purchased at the beginning of 2016. Straight-line depreciation is used and a residual value of $31,000 for the building is anticipated.

The equipment is comprised of the following three machines:

The straight-line method is used to determine depreciation on the equipment. On March 31, 2021, Machine 102 was sold for $39,000. Early in 2021, the useful life of machine 101 was revised to five years in total, and the residual value was revised to zero.

Required:

1. Calculate the accumulated depreciation on the equipment at December 31, 2020.
2. Prepare the journal entry to record 2021 depreciation on machine 102 up to the date of sale.
3. Calculate the gain or loss on the sale of machine 102.
4. Prepare the journal entry for the sale of machine 102.
5. Prepare the 2021 year-end journal entries to record depreciation on the building and remaining equipment.

The balances in the accounts of Maybe Ltd at 30 June 2019 and 30 June 2020 are:

Other information:

Share capital is increased by the bonus issue of 24 000 shares for $1.00 each out of retained earnings. Plant is acquired during the period at a cost of $36 000, while plant with a carrying amount of $nil (cost of $24 000, accumulated depreciation of $24 000) is scrapped.

Required:

a)      Reconstruct the allowance for doubtful debts and accounts receivable.

b)      Reconstruct inventory and accounts payable

c)      Reconstruct accrued salaries

d)      Reconstruct property, plant and equipment and accumulated depreciation

e) Present a statement of cash flow for Maybe Ltd for the year ended 30 june 2020

c. using the indirect method, calculate onlly the net cash flow from operating activities for windsor company for the year ended May 31, 2020

Investment in Trading and AFS Securities

In 2019, a company purchases debt securities at a par value of $500,000. Their year-end value is $520,000. In 2020, these securities are sold for $525,000 and new securities are purchased for $700,000. At the end of 2020, the securities have not yet been sold, and have a value of $600,000.

Required
Prepare the journal entries to record the above information for 2019 and 2020, assuming that:

a. The securities are categorized as trading securities.

Swaps

A. What is the cash flow position for Company A Year 1-4?

B. What is cash flow position for Company B Year 1-4?

Company A borrows $600,000 from Lender 1. The loan demands interest-only be paid and it is a variable term based on the U.S. 10-year bond plus 1%. Company B borrows $600,000 from Lender 2. The loan is fixed at 3% and requires payment of interest-only.

After Year 2, Company A enters into an agreement with Company B, wherein each of them agree to exchange interest cash flows that arise from a notional amount of $350,000, as follows: Company A agrees to pay Company B a fixed rate of 2.5% of the notional amount. These cash flows will happen in Years 3 and 4. Also, Company B agrees to pay Company A a variable rate of the 10-year US Bond rate plus 0.50%, of the notional amount. These cash flows will happen in Years 3 and 4.

Mary, the plant manager of Southern Oregon Injection Molding, Inc. (SOIM), is pondering an interesting offer made by the president and majority shareholder, Kenny. Kenny recently turned sixty and is planning a gradual retirement. None of his children are interested in taking over the business and are currently pursuing careers unrelated to the plastics industry, so Kenny has decided to offer his controlling share to Mary.

SOIM began by manufacturing plastic lawn ornaments, including a colorful tropical bird that became a major fad in the 1980s. Pleased and amused by the success of his fanciful product, Kenny added rabbits, skunks, trolls, angels, and garden fairies to the product line. Under Mary’s leadership, SOIM has also become an important secondary supplier of plastic housings for speakers, cell phones, calculators, and similar products.

Marry started working at SOIM as a color technician shortly after graduating from Southern Oregon University with a degree in chemical engineering. Within five years, she became the plant manager, a position she has held for the last eight years. Along the way, she has earned an MBA through the evening program at Southern Oregon University.

Because SOIM stock is publicly traded, we can confidently assign a value of $10,000,000 to Kenny’s shares. Kenny has stated that he is open to any reasonable plan to finance the purchase.

Questions

1. Mary could probably borrow the money to purchase the shares outright because the shares would serve as collateral and dividends would cover a good part of the loan payments. The interest rate is 7%, and the lender will amortize the loan with a series of equal payments. What are the annual payments if the bank amortizes the loan over five, ten, or twenty years?

2. Repeat Question 1, but assume that Mary makes payments at the beginning of each year.

3. Complete the following amortization schedule for a $10,000,000 loan at 7% with five equal end-ofyear payments.

4. Kenny has offered to finance the purchase with a ten-year, interest-only loan. How much is Mary’s annual payment? Describe the pattern of payments over the ten years.

5. Assume that Kenny accepts Mary’s offer to finance the purchase with a ten-year, interest-only loan. If Kenny can reinvest the interest payments at a rate of 7% per year, how much money will he have at the end of the tenth year?

Come up with a 5 elements of each category of the SWOT of 1-800-GOT-JUNK?

Eighteen thousand expired cans of sardines.84 Fifty garden gnomes. A mechanical bull. Trophies from a nudist colony. These objects are just some of the weird items that Vancouver-based 1-800-GOT-JUNK? customers have asked the uniformed people in the freshly scrubbed blue trucks to haul away. Company founder and CEO Brian Scudamore discovered a lucrative niche between “trash cans and those big green bins dropped off by” the giant waste haulers. But even in such an uncomplicated business as hauling people’s junk, Scudamore must be concerned with managing change and innovation.

1-800-GOT-JUNK? is an award-winning company with a corporate staff of about 300 individuals. “With a vision of creating the ‘FedEx’ of junk removal,” says Scudamore, “I dropped out of university with just one year left to become a full-time JUNKMAN! Yes, my father, a liver transplant surgeon, was not impressed, to say the least.” However, in 2011, the company had more than 200 franchises, and system-wide revenues were over $100 million.85 Not surprisingly, Scudamore’s father is a little more understanding these days about his son’s business. Since 1997, the company has grown exponentially. The company made the list of Entrepreneur magazine’s 100 fastest-growing franchises in 2005 and 2006. It was named one of the Best Employers in Canada by Canadian Business, and Scudamore won the International Franchise Association’s Entrepreneur of the Year award. Scudamore also started two newer franchises: Wow 1 Day Painting and You Move Me.

Hauling junk would be, to most people’s minds at least, a pretty simple business. However, the company Scudamore founded is a “curious hybrid.” It has been described as a blend of “old economy and new economy.” The company’s service—hauling away trash—has been done for hundreds, if not thousands, of years. But 1-800-GOT-JUNK? also relies heavily on up-to-date information technology and has the kind of organizational culture that most people associate with high-tech startups. The company uses its 1-800-GOT-JUNK? call centre to do the booking and dispatching for all its franchise partners. The franchise partners also use the company’s proprietary intranet and customer relationship management site—dubbed JunkNet—to access schedules, customer information, real-time reports, and so forth. According to Scudamore’s philosophy, this approach allowed franchise partners to “work on the business” instead of “work in the business.” On any given day, all a franchisee has to do is open up JunkNet to see the day’s schedule. If a new job comes in during a workday, the program automatically sends an alert to the franchisee. Needless to say, the company’s franchisees tend to be quite tech-savvy. In fact, some of them have installed GPS devices in their trucks to help find the most efficient routes on a job. Others use online navigation sites. With the price of gas continuing to increase, this type of capability is important.

1-800-GOT-JUNK? has a culture that would rival any high-tech startup. The head office is known as the Junktion. Grizzly, Scudamore’s dog, comes to the office every day and helps employees relieve stress by playing catch anytime, anywhere. Each morning at exactly 10:55, all employees at the Junktion meet for a seven-minute huddle, where they share good news, announcements, metrics, and problems they are encountering. Visitors to the Junktion have to join the group huddle, too. One of the most conspicuous features of the Junktion is the “Vision Wall,” which contains the varied outputs of Scudamore’s brainstorms. Other members of the executive team have visions for the company’s future as well. Periodically they will wander through the offices of Genome Sciences Centre, the tenant occupying the space above them, to visualize a future when GOT-JUNK? has expanded so sufficiently that it will take over that office space. Scudamore does not use a permanent desk, instead preferring to sit in different spaces to talk with people and get a sense of what is going on in the business.

Company franchisees are also encouraged to take initiative and be innovative. For example, the Toronto franchise, which has 12 trucks, sometimes gets a blue truck motorcade going down Yonge Street through the heart of the city as a way to be noticed and to publicize its services. Despite the company’s success to date, Scudamore is wondering whether he is prepared to face whatever changes may happen in the environment in the years to come.