1. We expect labor supply to be very inelastic due to opposing income and substitution effects. As a result:
   1. (5 points) Why might the assumption that this tax rate change is Tax revenue neutral be problematic? Would you expect Tax revenue actually to increase or decrease? Why?
   2. (5 points) Based on your analysis in the model, how is the change in income (hint, yes total income does change) distributed across household that depend on labor income vs. household that depend on capital income? (i.e. - whose income is affected more and how (increase or decrease)?)

Shamrock Company is involved in five separate industries. The following information is available for each of the five industries:

Required: Determine which of the operating segments are reportable based on the:

Revenue test.                                                                         

Operating profit (loss) test.                                                    

Identifiable assets test.                                                          

What are the benefits of disclosing financial results based on segments?

1. One reason governments impose taxes is to:

a. spur economic growth

b. raise government revenues

c. encourage more production

d. increase consumer spending

2. One cost associated with the imposition of taxes is:

a. shortages

b. overconsumption

c. scarcity

d. deadweight loss

3. The total amount of surplus lost due to taxation is:

a. less than the amount of revenue generated

b. greater than the amount of revenue generated

c. used to fund public services

d. transferred to the government in the form of tax revenues

Indiana Co. began a construction project in 2016 with a contract price of $150

million to be received when the project is completed in 2018. During 2016, Indiana

incurred $36 million of costs and estimates an additional $84 million of costs to

complete the project. Indiana recognizes revenue over time and for this project

recognizes revenue over time according to the percentage of the project that has

been completed.

Suppose that, in 2017, Indiana incurred additional costs of $63.75 million and

estimated an additional $42.75 million in costs to complete the project. What profit

or loss will Indiana record for 2017?

Bill’s Bakery’s Inventory account had a balance of $8,000 on April 1^st and a balance of $13,000 on April 30^th. Bill’s sold $62,000 worth of inventory for $85,000 during April. Complete the T account for Bill’s Inventory. How much Revenue does Bill’s have? _______________ How much expense? ___________________What is their Gross Margin? _______________ How much inventory did Bill’s purchase during April? ______________

Write the journal entry to record Bill’s purchases:

Write the journal entry to record Bill’s revenue:

Write the journal entry to record Bill’s expense:

Accounts payable $18,500

Accounts receivable 8,000

Accumulated depreciation-equipment 4,800

Bonds payable 18,000

Cash 24,000

Common stock 25,000

Cost of goods sold 27,000

Depreciation expense 4,800

Dividends 5,300

Equipment 44,000

Interest expense 2,500

Patents 7,500

Retained earnings, January 1 16,000

Salaries and wages expense 5,200

Sales revenue 50,500

Supplies 4,500

Determine the profitability ratio that tells us for every dollars of sales revenue how much operating profit the firm has generated.And solve for the ratio.

Using the year 2013-2017 financial data of Coca-Cola and PepsiCo companies, determine their 5-year average growth rates related to net sales and income from continuing operations. Coca Cola: Net Sales: 7.86% Increase. PepsiCo: Net Sales: 3.11% Increase. And what data to use to calculate.

As part of a January promotion, flint life fitness ltd. sold six-month membership to its gym for $300. This also included a personal fitness assessment and training plan. Active Life normally charges $360 for a six-month membership and $90 for a personal fitness assessment and training plan.

Using the five-step model, determine the amount of revenue that Flint Life would recognize in January, assuming that 320 memberships were sold as part of this promotion and that all of the personal fitness assessment and training plans were completed in January.

Amount of revenue $_______