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Apple Inc. is the number one online music retailer through its iTunes music store. Apple sells iTunes gift cards in $15, $25, and $50 increments. Assume Apple sells $20.1 million in iTunes gift cards in November, and customers redeem $13.1 million of the gift cards in December.

Required:

1. & 2. Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5.5 should be entered as 5,500,000).)

1. Record the receipt of cash for gift cards.

2. Record the revenue recognized from redemption of gift cards.

3. What is the ending balance in the Deferred Revenue account? (Enter your answer in dollars, not in millions. (i.e. 5.5 should be entered as 5,500,000).)

On June 1, 2021, Royal Property Management entered into a one-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2021. Under the terms of the contract, Royal will be paid a fixed fee of $69,000 and will receive an additional 10% of the fixed fee at the end of the contract provided that building occupancy exceeds 80%. Royal estimates a 20% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract.

Assume Royal estimates variable consideration as the expected value. How much revenue should Royal recognize on this contract in 2021?

Multiple Choice

• $35,190

• $38,250

• $34,500

• $69,000

Which of the following is not a performance obligation?

Multiple Choice

• A good that the seller could sell separately and that is separately identifiable from other goods or services in the contract.

• An extended warranty.

• A right of return.

• An option for a customer to purchase goods under terms that are more advantageous than those enjoyed by other customers.

1. Shareholders invested £10,000 cash in the business in exchange for ordinary shares.

2. Purchased equipment for £5,000 cash.

3. Paid £400 cash for May office rent.

4. Paid £700 cash for supplies.     

5. Incurred £250 of advertising costs in the Beacon News on account.

6. Received £4,700 in cash from customers for repair service.

7. Declared and paid a £1,000 cash dividend.

8. Paid part-time employee salaries £1,000.

9. Paid utility bills £160.

10. Performed repair service worth £980 on account.

11. Collected cash of £120 for services billed in transaction (10). Instructions

Prepare a tabular analysis of the transactions, using the following column headings: Cash, Accounts Receivable, Supplies, Equipment, Accounts Payable, Share Capital, and Retained Earnings (with separate columns for Revenues, Expenses, and Dividends). Include margin explanations for any changes in Retained Earnings. Revenue is called Service Revenue.

Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below:

The data presented in worksheet 4 is the results of a 4-year study conducted to assess how age, weight, and gender influence the risk of diabetes. Risk is interpreted as the probability (times 100) that the patient will have diabetes over the next 4-year period.

a) What predictive model you suggest to relate risk of diabetes to the person’s age, weight and the gender. Why? b)Develop an estimated multiple regression model that relates risk of diabetes to the person’s age, weight, gender and life style. Present the regression formula as a mathematical equation. Interpret the coefficients of the regression and comment on the strength of the regression.

c) What is the risk percentage of diabetes over the next 4 years for a 52-year-old woman living in a small town with 80 kg weight?

The trailer division of Baxter Bicycles makes bike trailers that attach to bicycles and can carry children or cargo. The trailers have a retail price of $99 each. Each trailer incurs $30 of variable manufacturing costs. The trailer division has capacity for 22,000 trailers per year and incurs fixed costs of $500,000 per year.
   
Required:
1. Assume the assembly division of Baxter Bicycles wants to buy 5,700 trailers per year from the trailer division. If the trailer division can sell all of the trailers it manufactures to outside customers, what price should be used on transfers between Baxter Bicycles's divisions?
2. Assume the trailer division currently only sells 10,100 trailers to outside customers, and the assembly division wants to buy 5,700 trailers per year from the trailer division. What is the range of acceptable prices that could be used on transfers between Baxter Bicycles's divisions?

The Trailer division of Baxter Bicycles makes bike trailers that attach to bicycles and can carry children or cargo. The trailers have a retail price of $100 each. Each trailer incurs $37 of variable manufacturing costs. The Trailer division has capacity for 26,000 trailers per year and incurs fixed costs of $580,000 per year. Required: 1. Assume the Assembly division of Baxter Bicycles wants to buy 5,700 trailers per year from the Trailer division. If the Trailer division can sell all of the trailers it manufactures to outside customers, what price should be used on transfers between Baxter Bicycles's divisions? 2. Assume the Trailer division currently only sells 9,200 Trailers to outside customers, and the Assembly division wants to buy 5,700 trailers per year from the Trailer division. What is the range of acceptable prices that could be used on transfers between Baxter Bicycles's divisions?

A random sample of five observations from three normally distributed populations produced the following data: (You may find it useful to reference the F table.)

a. Calculate the grand mean. (Round intermediate calculations to at least 4 decimal places and final answer to 4 decimal places.)

Grand mean

b. Calculate SSTR and MSTR. (Round intermediate calculations to at least 4 decimal places and final answers to 4 decimal places.)

SSTR

MSTR

c. Calculate SSE and MSE. (Round intermediate calculations to at least 4 decimal places and final answers to 4 decimal places.)

SSE

MSE

d. Specify the competing hypotheses in order to determine whether some differences exist between the population means.

• H₀: μ_A = μ_B = μ_C; H_A: Not all population means are equal.

• H₀: μ_A ≤ μ_B ≤ μ_C; H_A: Not all population means are equal.

• H₀: μ_A ≥ μ_B ≥ μ_C; H_A: Not all population means are equal.

e-1. Calculate the value of the F_{(df1, df2)} test statistic. (Round intermediate calculations to at least 4 decimal places and final answer to 3 decimal places.)

Test Statistic

e-2. Find the p-value.

• 0.025  p-value < 0.05
• 0.01  p-value < 0.025

• p-value < 0.01

• p-value  0.10
• 0.05  p-value < 0.10

f. At the 10% significance level, what is the conclusion to the test?

• Reject H₀ since the p-value is less than significance level.

• Do not reject H₀ since the p-value is not less than significance level.

• Do not reject H₀ since the p-value is less than significance level.

• Reject H₀ since the p-value is not less than significance level.

g. Interpret the results at αα = 0.10.

• We cannot conclude that some means differ.

• We conclude that some means differ.

• We conclude that all means differ.

• We conclude that population mean C is greater than population mean A.

An investment carrying a current cost of $130,000 is going to generate $70,000 of revenue in each of the next three years. To calculate the internal rate of return we need to:

options:

calculate the present value of each of the $70,000 payments and multiply these and set this equal to $130,000.

take the present value of $210,000 for three years from now and set this equal to $130,000.

set the sum of the present value of $70,000 for each of the next three years equal to $130,000.

subtract $130,000 from $210,000 and set this difference equal to the interest rate.

Cutting Edge Pharmaceuticals Pty Ltd (a monopoly firm) has the following demand (average revenue) function: AR = 100 – Q

The marginal cost of production is given as constant and equal to $10.

a) What is the equation for the MR function? In showing this equation for the MR function explain the relationship between average revenue and marginal revenue. Determine the profit maximizing level of output of the firm (1 mark)

b) What is the equilibrium monopoly price set by the firm and what will be the monopoly profit earned? (1 mark)

c) Illustrate the market demand and marginal cost, average cost of this firm as well as, profit maximizing price quantity and profit level on a diagram (1 mark)