During 2020, Pharoah Furniture Company purchases a carload of wicker chairs. The manufacturer sells the chairs to Pharoah for a lump sum of $47,880 because it is discontinuing manufacturing operations and wishes to dispose of its entire stock. Three types of chairs are included in the carload. The three types and the estimated selling price for each are listed below.

During 2020, Pharoah sells 160 lounge chairs, 80 armchairs, and 96 straight chairs.

What is the amount of gross profit realized during 2020? What is the amount of inventory of unsold straight chairs on December 31, 2020? (Round cost per chair to 2 decimal places, e.g. 78.25 and final answer to 0 decimal places, e.g. 5,845.)

On June 1, 2020, the Crocus Company began construction of a new manufacturing plant. The plant was completed on October 31, 2021. Expenditures on the project were as follows ($ in millions):

On July 1, 2020, Crocus obtained a $70 million construction loan with a 6% interest rate. The loan was outstanding through the end of October, 2021. The company's only other interest-bearing debt was a long-term note for $100 million with an interest rate of 8%. This note was outstanding during all of 2020 and 2021. The company's fiscal year-end is December 31.

What is the amount of interest that Crocus should capitalize in 2021, using the specific interest method? (Enter your answers to nearest whole dollar amount.)

$7,283,000.

$7,117,000

$8,740,000.

$7,248,000.

On December 31, 2019, Cheyenne Inc. borrowed $3,960,000 at 13% payable annually to finance the construction of a new building. In 2020, the company made the following expenditures related to this building: March 1, $475,200; June 1, $792,000; July 1, $1,980,000; December 1, $1,980,000. The building was completed in February 2021. Additional information is provided as follows.

Determine the amount of interest to be capitalized in 2020 in relation to the construction of the building

Prepare the journal entry to record the capitalization of interest and the recognition of interest expense, if any, at December 31, 2020.

For its first year if operations, Altitude Inc. reports pretax GAAP income of $100,000 in 2020. Assume pretax income in 2021 and 2022 of $125,000 and $90,000 respectively. The enacted income tax rate in all years is 25%. The following additional information is available for the first three years of operation (with the exception of the one item in the 4th year).

• Prepaid rent in the amount of $20,000 was recorded on December 21, 2020 for 2021 rent.
• A warranty accrual of 30,000 was recorded on December 31, 2020. The warranty was paid evenly over the years 2021-2023.
• The company recorded interest revenue of $500 each of the three years on municipal bonds.

1. Compute the income tax payable each year for 202, 2021, 2022
2. Determined the balance of any deferred tax assets or deferred tax liabilities at the end of each year (2020, 2021, 2022)
3. Record the journal entry related to taxes in 2020, 2021, 20222

Summary: Key Points in the Article Apple Computer CEO Steve Jobs announced he was taking a leave of absence for health reasons. Jobs has been fighting cancer and also recently underwent a liver transplant. Even though the computer giant is in good hands with Chief Operating Officer Tom Cook taking over the stock price fell by​ US$6.40, or nearly two​ percent, on the news. Jobs is widely known as a visionary and a micromanager. Under his leadership Apple has transformed the computing industry. While​Jobs' health outlook is unknown many investors are betting on his recovery and return. Those who bought Apple stock when Jobs stepped down in 2004 for health reasons made a nice profit when he returned to the helm.   Question 2 Marks “. Do you agree with the decision taken in the above case? What decisions you will take to improve the stock price of Apple Computers in this situation?

P12.4 Monsecours Corp., a public company incorporated on June 28, 2019, set up a single account for all of its intangible assets. The following summary discloses the debit entries that were recorded during 2019 and 2020 in that account:

The new business started up on July 2, 2019. No amortization was recorded for 2019 or 2020. The goodwill purchased on April 1, 2020, includes in-process development costs that meet the six development stage criteria, valued at $175,000. The company estimates that this amount will help it generate revenues over a 10-year period.

Instructions

a. Prepare the necessary entries to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. Make the entries as at December 31, 2020, and record any necessary amortization so that all balances are appropriate as at that date. State any assumptions that you need to make to support your entries.

b.  In what circumstances should goodwill be recognized? From the perspective of an investor, does the required recognition and measurement of goodwill provide useful financial statement information?

Question 3 Part A XYZ Windows Ltd is involved in a research and development project to create a filtering window that removes the need for curtains. For the current year ended 30 June 2020 expenditure on the project is as follows: Research $235,000 Development $500,000 The window is expected to return profits of $70,000 per year for the 10 years commencing 1 July 2020. Assuming the company uses a straight-line method amortisation. This company uses a discount rate of 8 per cent. Required: i) How much research and development cost should be expensed in the year to 30 June 2020? ii) How much development expenditure should be amortised in the year to 30 June 2021?

Part B An assistant of yours has encountered the following matter during the preparation of the draft financial statements of XYZ Ltd for the year ending 30 June 2020. He /She has given an explanation of his/her treatment of the item. “XYZ Ltd management spent $200,000 sending its staff on training courses during the year. This has already led to an improvement in the company’s efficiency and resulted in cost savings. The organiser of the course has stated that the benefits from the training should last for a minimum of four years. The assistant has therefore treated the cost of the training as an intangible asset and charged six months’ amortisation based on the average date during the year on which the training courses were completed.” Required: Comment on the assistant’s treatment of them in the financial statement for the year ended 30 June 2020 and advise him how they should be treated under AASB 138 Intangible Assets.

Part C If an organisation is constructing a building, and that building will take a number of years to complete, can the organisation recognise revenue throughout the contract, or does the construction-based organisation have to wait until project completion before it recognises the revenue associated with the construction contract? Discuss this statement in accordance to AASB 15.

Shrieves Casting Company is considering adding a new line to its product mix, and the capital budgeting analysis is being conducted by Sidney Johnson, a recently graduated MBA. The cost of new machinery for the new product line would be $644,000. The machinery has economic life of eight years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the machine. The new line would generate incremental sales of 70,000 units per year at variable cost per unit of $21 and fixed cost of $725,000 per year. Each unit can be sold for $37 in the first year. The sale price and cost are both expected to remain the same. The firm’s tax rate is 35 percent, and the rate of return required for this type of investment is 15 percent. Calculate the base-case cash flow and NPV.

After graduating from Yorkville University with a BBA you are making a good salary and now want to begin investing. You are analyzing two Canadian Banks as investment options. Bank of Nova Scotia (BNS) and Bank of Montreal (BMO). The stock price of BNS is current $65. The price of BNS next year will be $53 if the economy is in a recession, $73 if the economy is normal, and $85 if the economy is expanding. The likelihood of recession, normal or expansion are 0.2, 0.6 and 0.2. respectively. BNS had suspended their dividend due to the pandemic crisis and has a beta of 0.68.   BMO has continued to pay its dividends and has an expected return of 13%, a standard deviation of 34%, a beta of 0.45, and a correlation with BNS of 0.48. The market portfolio has a standard deviation of 14%.
a) Assuming that the CAPM holds, what is the expected return and standard deviation of BNS?
After careful analysis you decide to invest 60% of your portfolio in BNS and 40% in BMO.
What are the ;
b) expected return
c) standard deviation
d) beta of this portfolio?

You receive a brochure from a large university. The brochure indicates that the mean class size for​ full-time faculty is fewer than 33 students. You want to test this claim. You randomly select 18 classes taught by​ full-time faculty and determine the class size of each. The results are shown in the table below. At alphaequals0.10​, can you support the​ university's claim? Complete parts​ (a) through​ (d) below. Assume the population is normally distributed. 38 29 27 35 35 37 26 22 29 25 32 36 34 30 29 33 26 26

​(a) Write the claim mathematically and identify Upper H 0 and Upper H Subscript a. Which of the following correctly states Upper H 0 and Upper H Subscript a​? A. Upper H 0​: muequals33 Upper H Subscript a​: munot equals33 B. Upper H 0​: mugreater than33 Upper H Subscript a​: muless than or equals33 C. Upper H 0​: mugreater than or equals33 Upper H Subscript a​: muless than33 D. Upper H 0​: muequals33 Upper H Subscript a​: muless than33 E. Upper H 0​: muless than33 Upper H Subscript a​: mugreater than or equals33 F. Upper H 0​: muless than or equals33 Upper H Subscript a​: mugreater than33

​(b) Use technology to find the​ P-value. Pequals nothing ​(Round to three decimal places as​ needed.) ​

(c) Decide whether to reject or fail to reject the null hypothesis. Which of the following is​ correct? A. Fail to reject Upper H 0 because the​ P-value is greater than the significance level. B. Reject Upper H 0 because the​ P-value is less than the significance level. C. Fail to reject Upper H 0 because the​ P-value is less than the significance level. D. Reject Upper H 0 because the​ P-value is greater than the significance level. ​

(d) Interpret the decision in the context of the original claim. A. At the 10​% level of​ significance, there is not sufficient evidence to support the claim that the mean class size for​ full-time faculty is more than 33 students. B. At the 10​% level of​ significance, there is sufficient evidence to support the claim that the mean class size for​ full-time faculty is fewer than 33 students. C. At the 10​% level of​ significance, there is sufficient evidence to support the claim that the mean class size for​ full-time faculty is more than 33 students. D. At the 10​% level of​ significance, there is not sufficient evidence to support the claim that the mean class size for​ full-time faculty is fewer than 33 students. Click to select your answer(s).