Utease Corporation has many production plants across the midwestern United States. A newly opened plant, the Bellingham plant, produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows.

Expected sales activity: 20,000 units at $425.00 per unit

Desired ending inventories: 10% of sales

Assume this is the first year of operations for the Bellingham plant. During the year, the company had the following activity.

In addition, all over- or underapplied overhead and all product cost variances are adjusted to cost of goods sold.

a. Prepare a production budget for the coming year based on the available standards, expected sales, and desired ending inventories.

b. Prepare a budgeted responsibility income statement for the Bellingham plant for the coming year.

c. Find the direct labor variances. Indicate if they are favorable or unfavorable. (Indicate the effect of each variance by selecting Favorable, Unfavorable, and "None" for no effect.)

d. Find the direct materials variances (materials price variance and quantity variance). (Enter your answers in dollars not in pounds. Indicate the effect of each variance by selecting Favorable, Unfavorable, and "None" for no effect (i.e., zero variance.)

f. Calculate the actual plant operating profit for the year.

Utease Corporation has many production plants across the midwestern United States. A newly opened plant, the Bellingham plant, produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit standard costs for a production unit, with overhead applied based on direct labor hours, are as follows.

Manufacturing costs (per unit based on expected activity of 24,000 units or 36,000 direct labor hours):

Direct materials (2 pounds at $20)   $   40.00        
Direct labor (1.5 hours at $90)      135.00        
Variable overhead (1.5 hours at $20)      30.00        
Fixed overhead (1.5 hours at $30)      45.00        
Standard cost per unit   $   250.00        
Budgeted selling and administrative costs:              
Variable   $   5      per unit
Fixed   $   1,800,000        

Expected sales activity: 20,000 units at $425.00 per unit

Desired ending inventories: 10% of sales

Assume this is the first year of operations for the Bellingham plant. During the year, the company had the following activity.

  
Units produced      23,000        
Units sold      21,500        
Unit selling price   $   420        
Direct labor hours worked      34,000        
Direct labor costs   $   3,094,000        
Direct materials purchased      50,000      pounds
Direct materials costs   $   1,000,000        
Direct materials used      50,000      pounds
Actual fixed overhead   $   1,080,000        
Actual variable overhead   $   620,000        
Actual selling and administrative costs   $   2,000,000        
  

In addition, all over- or underapplied overhead and all product cost variances are adjusted to cost of goods sold.

a. Prepare a production budget for the coming year based on the available standards, expected sales, and desired ending inventories.

b. Prepare a budgeted responsibility income statement for the Bellingham plant for the coming year.

d. Find the direct materials variances (materials price variance and quantity variance). (Enter your answers in dollars not in pounds. Indicate the effect of each variance by selecting Favorable, Unfavorable, and "None" for no effect (i.e., zero variance.)

f. Calculate the actual plant operating profit for the year.

Snow skiing and snowboarding remain popular hobbies. More than 10 million people in the United States participate in the activities each year. Ski resorts can be found across the country. The marketplace for equipment continues to grow. Ski and Snowboard Specialists offers a wide variety of equipment combined with connections to numerous resorts nationwide. Enthusiasts can shop online for skis, poles, snowboards, masks, clothing, and other gear and, at the same time, receive access to information about which areas have the best current conditions combined with discount offers for lodging, lifts, and other accommodations. Considerable competition exists for both equipment and informational/booking services. Ski and Snowboard Specialists sells products from the major manufacturers of equipment as they compete with local sports equipment stores and the lodges themselves. Travel agencies and other groups offer booking services. In the midst of this clutter, the marketing team believes the key to future success will rely on continuing engagement with those who have taken advantage of the reasonable prices the company offers for equipment and the convenience provided by the booking side of the business. The company’s primary website can be combined with mobile marketing and other new marketing techniques to entice new visitors while building loyalty with returning customers. To help achieve these overall objectives, the marketing team has established relationships with two professional skiers who serve as instructors at popular resorts. One is located in Colorado and the other in Maine. These individuals and their resorts regularly provide advice about all aspects of the two sports. Ski and Snowboard Specialists’ marketers have recently hired a major national advertising agency to assist in all aspects of the firm’s promotional efforts. The goal is to cast a wide net to attract and keep as many new clients as possible.

question?Discuss how location-based advertising could be featured by Ski and Snowboard Specialists

Cincinnati Paint Company sells quality brands of paints through hardware stores throughout the United States. The company maintains a large sales force who call on existing customers and look for new business. The national sales manager is investigating the relationship between the number of sales calls made and the miles driven by the sales representative. Also, do the sales representatives who drive the most miles and make the most calls necessarily earn the most in sales commissions? To investigate, the vice president of sales selected a sample of 25 sales representatives and determined:

• The amount earned in commissions last month (y)
• The number of miles driven last month (x₁)
• The number of sales calls made last month (x₂)

Develop a regression equation including an interaction term. (Negative amount should be indicated by a minus sign. Round your answers to 3 decimal places.)

Complete the following table. (Negative amounts should be indicated by a minus sign. Round your answers to 3 decimal places.)

Compute the value of the test statistic corresponding to the interaction term. (Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places.)

Value of the test statistic

At the 0.05 significance level is there a significant interaction between the number of sales calls and the miles driven?

Under the United States Generally Accepted Accounting Standards (U.S. GAAP), property, plant and Equipment are reported at historical cost net of accumulated depreciation. These assets are written down to fair value when it is determined that they have been impaired.

Several other countries, including Australia, Brazil,England, Mexico and Singapore, permit the revaluation of property, plant and equipment to their current cost as of the balance sheet date. The primary argument in favor of revaluation is that the historical cost of assets purchased ten, twenty, or more years ago is not meaningful. A primary argument against revaluation is the lack of objectivity in arriving at current cost estimates,particularly for old assets that either will or cannot be replaced with similar assets or for which there are no comparable or similar assets currently available for purchase.

Required:1) List and discuss the 5 qualitative concept of comparability. In your opinion, would the financial statements of companies operating in one of the foreign countries listed above be comparable to a U. S. company’s financial statements? Explain.

Wheels, Inc. manufactures bicycles sold through retail bicycle shops in the southeastern United States. The company has two salespeople that do more than just sell the products- they manage relationships with the bicycle shops to enable them to better meet consumers' needs. The company's sales reps visit the shops several times per year, often for hours at a time. The owner of Wheels is considering expanding to the rest of the country and would like to have distribution through 2,250 bicycle shops. To do so, however, the company would have to hire more salespeople. Each salesperson earns 35,000 plus 5 percent commission on all sales annually. Another alternative is to use the services of sales agents instead of its own sales force. Sales agents would be paid 8 percent of sales. Each sales call lasts approximately 3 hours and each sales rep has approximately 750 hours per year to devote to customers. Wheels needs 18 salespeople if it has 2,250 bicycle shop accounts that need to be called on two times per year. At what level of sales would it be more cost efficient for Wheels to use to sales agents compared to its own sales force? To determine this, consider the fixed and variable costs for each alternative. What are the pros and cons of using a company's own sales force versus independent sales agents?

Wheels, Inc. manufactures bicycles sold through retail bicycle shops in the southeastern United States. The company has two salespeople that do more than just sell the products- they manage relationships with the bicycle shops to enable them to better meet consumers' needs. The company's sales reps visit the shops several times per year, often for hours at a time. The owner of Wheels is considering expanding to the rest of the country and would like to have distribution through 2,250 bicycle shops. To do so, however, the company would have to hire more salespeople. Each salesperson earns 35,000 plus 5 percent commission on all sales annually. Another alternative is to use the services of sales agents instead of its own sales force. Sales agents would be paid 8 percent of sales. Each sales call lasts approximately 3 hours and each sales rep has approximately 750 hours per year to devote to customers. Wheels needs 18 salespeople if it has 2,250 bicycle shop accounts that need to be called on two times per year. At what level of sales would it be more cost efficient for Wheels to use to sales agents compared to its own sales force? To determine this, consider the fixed and variable costs for each alternative. What are the pros and cons of using a company's own sales force versus independent sales agents?

Consider two companies: United States steel (X) and Facebook (FB). Look at the profiles (financial statements for 2016) of each on yahoo finance and discuss the followings (you need to calculate these values yourself and show details of your calculations): How many outstanding shares the company has? What is the market value of the company? What is the book value of the company? What is the beta for the company? How do you find the risk free rate? (consider the market risk premium to be 8%) Using CAPM calculate the expected return on the equity for the company. (To get the required rate of return on debt, divide the interest expense by total debt) (To get the total debt, add the short term debt to long term debt) What is the Weighted average cost of capital (WACC) for the company? What is the leverage (total debt/equity ratio) for the company?

Suppose the United States and Hong Kong have a flexible exchange rate system. Explain whether each of the following events will lead to an appreciation or depreciation of the U.S. dollar and HK dollar. Please explain in words and graphically.

(a) U.S. real interest rates decrease below Hong Kong real interest rates.

(b) The Hong Kong inflation rate decreases relative to the U.S. inflation rate.
(c) A decrease in U.S. income combines with no change in Hong Kong income. (d) A decrease in U.S. income combines with a decrease in Hong Kong income.