Undergraduate Degree and MBA Major (3 parts, 14 marks)

BA (=1), BEng (=2), BBA (=3), and several others (=4). There are three possible majors for the MBA students: Accounting (=1), Finance (=2), and Marketing (=3). Can the Statistics professor conclude that the undergraduate degree affects the choice of major?

1. [2 Marks] Create a cross-classified (or contingency) table with undergraduate degree as the row and MBA major as the column. The data in this table should be deemed as observed counts.
2. [3 Marks] Create another table with the corresponding expected counts and having row totals, column totals, and grand total. Round each cell value to two decimal places.
3. [9 Marks] Perform a chi-square test to assess the association (or independence) between undergraduate degree and choice of MBA major at 5% level of significance. Verify the assumptions required for the chi-square test of independence. Make sure you follow all the steps for hypothesis testing indicated in the Instructions section and show your computations.

Summary

Wal-Mart’s stock tumbled on the news that the company was investigating possible violations of the Foreign Corrupt Practices Act. According to information leaked to the press, Wal-Mart may have been bribing Mexican government officials in order to gain the zoning approvals it needed to build stores in the country. What makes the story especially interesting was the fact that the company appears to have known about the violations for several years, yet seemingly chose to do nothing.

While Wal-Mart had no legal obligation to disclose the fact that it was looking into the situation some years ago, analysts agree that the company had an ethical responsibility to make some disclosure, particularly given that the retail giant seems to have done little with the knowledge of a potential violation. Investigators will be looking to see whether the company gained an unfair competitive advantage as a result of its illegal activity.

If the company is found to have violated the Foreign Corrupt Practices Act it could face fines, and possibly have to return some of the profits it earned as a result. In addition, because it seems that top level executives were aware of the bribes when they occurred, there could be further penalties. Wal-Mart’s current CEO, Mike Duke, was head of Wal-Mart International at the time of the bribes.  

Discussion Questions

1. If the allegations against Wal-Mart prove to be true, the company will certainly be penalized for its illegal behavior. Consider, though whether the Foreign Corrupt Practices Act puts U.S. firms at a competitive disadvantage in foreign markets. Does it actually encourage unethical behavior by firms?

2. Is it ethical for U.S. lawmakers to prohibit bribery in foreign markets? What are the implications of the Foreign Corrupt Practices Act on employment and economic development in countries like India and Mexico?

3. Suppose you are a U.S. supplier to Wal-Mart Mexico. Do you agree with the Foreign Corrupt Practices Act? How does it affect you? Do you feel that U.S. lawmakers have the right to limit the activities of U.S. firms in foreign markets?

Please answer it in your own words .

Bramble Corporation operates a retail computer store. To improve delivery services to customers, the company purchases four new trucks on April 1, 2020. The terms of acquisition for each truck are described below.

Prepare the appropriate journal entries for the above transactions for Bramble Corporation.

thanks!

Net U.S. energy imports have decreased every year since 2016. Last year’s change in net energy trade
(crude oil, natural gas, coal, and petroleum products) in the U.S.—from 3.6 quads of net imports in 2018 to
0.8 quads of net exports in 2019—was the largest change in U.S. energy trade since 1980. How would the
low oil price affect the U.S. crude oil trade (import and export) in 2020? Apply the D-S model.

Assuming you have been working with one of the Big4 as auditor for more than 7 years, Mr. Alex Chan is your close friend and he is the son of Mr. Derek Chan, the founder of Apple Ltd., a listed company with very successful track record. Derek and Alex are the chairman and vice chairman of the company respectively. As you are familiar with Alex and his family, you learn that most of the senior management are from the same family of the founder, the financial controller, is in charge of finance department with the assistance of his sister Miss Candy Lee, who was decided to immigrate to England next month. Mr. Alex Chan would like to invite you to replace her as an assistant financial controller helping his brother-in-law, Mr. Peter Lee. Will you accept the offer and justify your answer? (Hint: Identify FOUR features of a family controlled company which affect your decision)

Carolyn Shaw is 27. - She works as an accountant for an oil company. - Her salary next year will be $80,000. - She expects to receive a 5 percent raise each year until she retires at age of 65. - Carolyn is considering a return to school to pursue an MBA degree. - She expects the cost of books, tuition, and fees to be $70,000 the first year and $72,000 the second. - These costs are paid at the beginning of the year (as you surely know). - She will not work while in school. - Graduates of the school Carolyn is considering receive starting salaries that average $130,000. - Raises average 7 percent per year. - Carolyn considers the opportunity costs to be 12 percent. a)Determine the present value of Carolyn’s lifetime earnings if she does not return to school. b)Determine the present value of Carolyn’s lifetime earnings with an MBA degree. Remember, she won’t start her job for two years. c) What is the NPV of an MBA degree given Carolyn Shaw's assumptions?

Selected accounts included in the property, plant, and equipment section of Tamarisk Corporation’s balance sheet at December 31, 2019, had the following balances.

During 2020, the following transactions occurred.

(a)

Calculate the balance at December 31, 2020 in each of the following balance sheet accounts. (Hint: Disregard the related accumulated depreciation accounts.)

Selected accounts included in the property, plant, and equipment section of Pearl Corporation’s balance sheet at December 31, 2019, had the following balances.

Land $438,000

Land improvements 204,400

Buildings 1,606,000

Equipment 1,401,600

During 2020, the following transactions occurred.

1. A tract of land was acquired for $219,000 as a potential future building site.

2. A plant facility consisting of land and building was acquired from Mendota Company in exchange for 29,200 shares of Pearl’s common stock. On the acquisition date, Pearl’s stock had a closing market price of $37 per share on a national stock exchange. The plant facility was carried on Mendota’s books at $160,600 for land and $467,200 for the building at the exchange date. Current appraised values for the land and building, respectively, are $335,800 and $1,007,400.

3. Items of machinery and equipment were purchased at a total cost of $584,000. Additional costs were incurred as follows.

Freight and unloading $18,980

Sales taxes 29,200

Installation 37,960

4. Expenditures totaling $138,700 were made for new parking lots, streets, and sidewalks at the corporation’s various plant locations. These expenditures had an estimated useful life of 15 years.

5. A machine costing $116,800 on January 1, 2012, was scrapped on June 30, 2020. Double-declining-balance depreciation has been recorded on the basis of a 10-year life.

6. A machine was sold for $29,200 on July 1, 2020. Original cost of the machine was $64,240 on January 1, 2017, and it was depreciated on the straight-line basis over an estimated useful life of 7 years and a salvage value of $2,920.

(a) Calculate the balance at December 31, 2020 in each of the following balance sheet accounts. (Hint: Disregard the related accumulated depreciation accounts.)

Balance at December 31, 2020

Land?

Land Improvements?

Buildings?

Equipment?

Selected accounts included in the property, plant, and equipment section of Sheffield Corporation’s balance sheet at December 31, 2019, had the following balances.

During 2020, the following transactions occurred.

(a)

Calculate the balance at December 31, 2020 in each of the following balance sheet accounts. (Hint: Disregard the related accumulated depreciation accounts.)

Balance at December 31, 2020

Land

Land Improvements

Buildings

Equipment