Question 2.

Intergalactic Software Company went public three months ago. You are a sophisticated investor who devotes time to fundamental analysis as a way of identifying mispriced stocks.

1)Which of the following characteristics would you focus on in deciding whether to follow this stock?

• Market capitalization
• The average number of shares traded per day
• The bid-ask spread for the stock
• Whether the underwriter that brought the firm public is a top tier investment banking firm
• Whether the firm’s audit company is a Big Four firm
• Whether there are analysts from major brokerage firms following the company
• Whether the stock is held mostly by retail or by institutional investors

2) When you looked at the projection for Intergalactic Software Company’s revenue in the future, you found that most of analysts assume the revenue growth rate is mean-reverting over time. What is the rationale to assume that revenue growth rate is mean-reverting over time?

Question: Is 5-year assurance service a distinct performance obligation in this contract? and How to currently recognise the revenue from Align by amortizing it over the 5-year assurance period.

SS enters into arrangements with customers that can include various combinations of software and services. Among its product portfolios, one arrangement makes significant revenue contribution in 2019 and 2018. Align is a project management software targeted at small and medium businesses. SS’s usual arrangement with customers not only includes the software license, but also includes customizing the software and integrating it into the customers’ information systems. In addition, customers purchasing the software license will receive software assurance service over a 5-year period at no additional cost. The assurance service guarantees proper functioning of the software within the customers’ information system. The company currently recognize the revenue from Align by amortizing it over the 5-year assurance period.

Question 13. The following information is from BYE-BYE Industries master budget for the 2016:

a. calculates per unit amount at 25,000 units.

b. Prepare flexible budgets for the production and sale of 24,000, 25,000 and 28,000 units, respectively in upcoming years.

1. Miller Corporation is a manufacturer with four product lines. Below is some financial information about each of the four product lines.

            Using all the tests below, determine which of the product segments are reportable segments and

            explain how nonreportable segments (if any) should be reported

18) The Statement of cash flows provides information that may be useful in predicting future cash flows, evaluating financial flexibility, assessing liquidity, and identifying a company's financial needs. It is not, however, the best financial statement for learning about a firm's financial performance during a period. Information about a company's financial performance is provided by the income statement. Two basic principles-the revenue recognition principle and the matching concept-work to distinguish the income statement from the statement of cash flows. (a) Define the revenue recognition principle and the matching concept. (b) Briefly explain how these two principles work to make the income statement a better report regarding a firm's periodic financial performance than the statement of cash flows.

In Question 18, our authors focus on the Revenue Recognition and Matching Principles to distinguish between the Income Statement and the Cash Flow Statement. Is there another way to think of the Cash Flow Statement? What type of statement might it be?

The following trial balance of Pronghorn Landowska does not balance. Your review of the ledger reveals the following. (a) Each account had a normal balance. (b) The debit footings in Prepaid Insurance, Accounts Payable, and Property Tax Expense were each understated $92. (c) A transposition error was made in Accounts Receivable and Service Revenue; the correct balances for Accounts Receivable and Service Revenue are $2,750 and $6,690, respectively. (d) A debit posting to Advertising Expense of $281 was omitted. (e) A $1,530 cash drawing by the owner was debited to Owner’s Capital and credited to Cash.

Andy "Nard Dog" Bernard recently graduated from Cornell. As a graduation gift, Nard Dog's Father gave him the family's old Toyota Prius because, according to the father, "the Ferarri feels more like your brother and the old Prius seems more your style." The Prius was originally purchased 8 years ago for $33,000 and today it is worth $16,000. Is the gift taxable to Andy? If so, how much is taxable? Cite at least one section of the Internal Revenue Code to support your answer. Is the gift taxable to to the father? If so, how much is taxable? Cite at least one section of the Internal Revenue Code to support your answer. If the father sold the Prius and gave the proceeds as a gift to Andy would the gift be taxable to either Andy or the Father? If so, how much would be taxable? Cite at least one section of the Internal Revenue Code to support your answer.

Question 7
Carna Ltd is a listed diversified retail company. Its stores are located mainly in Australia. It
has three main types of stores: general department stores, liquor stores, and specialist toy
stores. Each of these stores has different products, customer types, and distribution processes.
In accordance with AASB 8/IFRS 8, Carna Ltd has identified three operating segments:
general stores, liquor stores, and toy stores.

All three business units earn most of their revenue from external customers. Total
The consolidated revenue of Carna Ltd is $400 million.

General Liquor   Toy   All segments
$m $m $m   $m

Revenue 250 110 40    400
Segment result (profit) 14 5 3 21
Assets 400 170 75 650

Required:
Identify Carna Ltd’s reportable segments in accordance with AASB 8/IFRS 8. Explain
your answer.

The information below should be used to prepare (in proper form in Excel) a Public Transportation column for the proprietary fund Statement of Revenues, Expenses, and Changes in Fund Net Position for the fiscal year ending May 31, 2018.

Please also answer the following questions in MS Word:

1. What observations can you make about the fund’s activity from June 1, 2017-May 31, 2018?
2. Identify the other proprietary fund statements and what measurement focus and basis for accounting are used in those statements.
3. What reports and schedules are included in the CAFR as required supplementary information?

1. The system of using a monetary unit, such as the US dollar, to value the transaction is known as which of the following?

a. monetary measurement concept

d. separate entity concept

c. going concern assumption

d. time period assumption

2. Which of these statements is false?

a. Liabilities – Equity = Assets

b. Assets = Liabilities + Equity

c. Assets – Liabilities = Equity

d. Liabilities = Assets – Equity

3. Which of the following principles matches expenses with associated revenues in the period in which the revenues were generated?

a. expense recognition (matching) principle

b. revenue recognition principle

c. cost principle

d. full disclosure principle

4. Which of the following is the principle that a company must recognize revenue in the period in which it is earned; it is not considered earned until a product or service has been provided?

a. revenue recognition principle

b. expense recognition (matching) principle

c. cost principle

d. full disclosure principle