Ajman Corporation adopted the dollar-value LIFO method of inventory valuation on December 31, 2017. Its inventory at that date was 220000 and the relevant price index was 100. Information regarding inventory for subsequent years is as follows.

Date Inventory at Current Prices    Current Price index

December 31, 2018    256800 107

December 31, 2019    320000    108

December 31, 2020    350000 120

A. What is the cost of ending inventory on December 31, 2018 under dollar value LIFO

B. What is the cost of ending inventory on December 31, 2019 under dollar value LIFO

C. What is the cost of ending inventory on December 31, 2020 under dollar value LIFO

A manager at Strateline Manufacturing must choose between two shipping alternatives: one-day freight and five-day freight. Using five-day freight would cost $175 less than using one-day freight. The primary consideration is holding cost, which is $10 per unit a year. One thousand items are to be shipped. Which alternative would you recommend? Explain.

Determine which shipping alternative would be most economical to ship 100 boxes of parts when each box has a price of $200 and holding costs are 40 percent of price, given this shipping information: overnight, $300, three-day, $200, six-day, $180.

1. Suppose you have a 10% bond that pays annual coupon and with mature in 10 years. The face value is $1,000, and the yield to maturity on a similar bond is 8%.         The bond is also convertible with a conversion price of 100. The stock is currently selling for $120. What is the minimum price of the bond?

2. You are considering a project that will require an initial outlay of $200,000. This project has an expected life of five years and will generate after-tax cash flows to the company as a whole of $60,000 at the end of each year over its five-year life. Thus, the free cash flows associated with this project look like this.

Given a required rate of return of 10% percent, calculate the IRR.

Overview

In this assignment you will apply what you have learned about standard deviation and normal curves to solve a number of problems, including finding the area under selected sections of a normal curve using z-scores, then solve a problem using normal distributions.

Part 1:

The weights of all one hundred (100) 9th graders at a school are measured, and it is found that the mean of all the measurements is 100 lbs., with a standard deviation of 15 lbs.   Explain how you would use this information to determine the percentage of students who weighed between 85 lbs and 115 lbs. Make sure your explanation includes the use of z-scores.

Part 2:

Using the example in part 1 above, answer the following questions in the same document you used to answer the questions from part 1. Make sure you show all the work required by the questions.

• What is the percentage of students who weighed between 85 lbs and 115 lbs? (Show calculations)
• What is the z-score of a student who weighed 105 lbs? (Show calculations)
• If a student weighed only 60 lbs, how many students out of the one hundred 9th graders would weigh more? (Hint: calculate the percentage 1st)

Part 3:

The following year, the 9th grade students are weighed again, and this time it is found that the mean of all weights is 108 lbs, and the standard deviation is 17 lbs. Answer the following questions, using the same document you used in parts 1 and 2 to show how you arrived at your answers.

Compare two students, one from the first class who weighed 98 lbs, and one from the second class who weighed 100 lbs.

• Which of the two students was heavier relative to their class? (Hint:compare z-scores)
• What percentage of students in the first class were heavier than the 98 lb. student?
• What percentage of students in the second class were heavier than the 100 lb. student?

2. Accounting procedures allow a business to evaluate their inventory costs based on two methods: LIFO (last in first out) or FIFO (first in first out). A manufacturer evaluated its finished goods inventory (in $000s) for five products with the LIFO and FIFO methods. To analyze the difference, they computed FIFO − LIFO for each product. We would like to determine if the LIFO method results in a lower cost of inventory than the FIFO method.

What is the alternate hypothesis?

Multiple Choice

• H₁: µ_d ≤ 0

• H₁: µ_d ≠ 0

• H₁: µ_d = 0

• H₁: µ_d > 0

3. A recent study focused on the number of times men and women send a Twitter message in a day. The information is summarized here.

At the 0.01 significance level, is there a difference in the mean number of times men and women send a Twitter message in a day? Based on the p-value, what is your conclusion?

Multiple Choice

• Fail to reject the null hypothesis.

• Reject the null hypothesis and conclude the means are different.

• Reject the null hypothesis and conclude the means are the same.

• Fail to reject the null hypothesis and conclude the means are different.

6. Accounting procedures allow a business to evaluate its inventory costs based on two methods: LIFO (last in first out) or FIFO (first in first out). A manufacturer evaluated its finished goods inventory (in $000s) for five products with the LIFO and FIFO methods. To analyze the difference, they computed FIFO − LIFO for each product. We would like to determine if the LIFO method results in a lower cost of inventory than the FIFO method.

What is the value of calculated t?

Multiple Choice

• +0.933

• +0.47

• −2.028

• ±2.776

7. Use the following table to determine whether or not there is a significant difference between the average hourly wages at two manufacturing companies.

The p-value is ______.

rev: 12_06_2019_QC_CS-192965

Multiple Choice

• 2.58

• 0.036

• 0.4664

• 0.0672

9. A recent study focused on the number of times men and women send a Twitter message in a day. The information is summarized here.

At the 0.01 significance level, we ask if there is a difference in the mean number of times men and women send a Twitter message in a day. What is the value of the test statistic for this hypothesis test?

Multiple Choice

• 2.40

• 2.672

• 2.58

• 2.668

11. A company is researching the effectiveness of a new website design to decrease the time to access a website. Five website users were randomly selected, and their times (in seconds) to access the website with the old and new designs were recorded. To compare the times, they computed new website design time − old website design time. The results follow.

For a 0.01 significance level, what is the critical value?

Multiple Choice

• −1.895

• −3.747

• −2.447

• −2.256

You are ready to purchase a home that has a price of $400,000. You will make a down payment of $50,000 and will finance the remainder with a 15-year loan. The stated rate on the loan is 6% annual with monthly payments.

a) Compute the monthly payment that you will be making on this loan.

b) What would be your monthly payment if you financed the home for 30 years?

c) Provide an amortization schedule of three months for this loan, beginning with the first payment.

d) After living in this home for 10 years, you decided to sell the home and find that the sale price of the home will be $500,000. If you sell the home at this price, how much cash can you receive from the sale, ignoring the commissions?

Cameron likes to eat hot dogs, but franks and buns must be purchased separately. Cameron needs an equal number of franks and buns (1 frank + 1 bun = 1 hot dog; they are perfect complements) and has a budget of $3 for hot dogs. The price of hot dog buns is always $0.25 each. If the price of franks is $0.50 each, how many franks and buns will Cameron buy? If the price of franks increases to $0.75 each, how many franks and buns will Cameron buy? First, use your common sense to answer the question, and then explain your answer by drawing Cameron's indifference curves and budget lines for buns and franks. Put buns on the x-axis.

What is the price of each of the following bonds ($1,000 principal) if the current interest rate is 8 percent?

Firm A: coupon 5%, Maturity 7 years

Firm B: coupon 5%, Maturity 14 years

Firm C: coupon 12%, Maturity 7 years

Firm D: coupon 12%, Maturity 14 years

b) What is the duration of each bond?

c) Rank the bonds in terms of price fluctuations with the least volatile bond first and the most volatile bond last as judged by each bond’s duration

d) Confirm your volatility ranking by determining the percentage change in the price of each bond if interest rates rise up to 11%.

PLEASE SHOW WORK

Jackson Company produces plastic that is used for injection-molding applications such as gears for small motors. In 2016, the first year of operations, Jackson produced 4,100 tons of plastic and sold 3,075 tons. In 2017, the production and sales results were exactly reversed. In each year, the selling price per ton was $ 2,000, variable manufacturing costs were 16% of the sales price of units produced, variable selling expenses were 10% of the selling price of units sold, fixed manufacturing costs were $ 2,788,000, and fixed administrative expenses were $ 530,000 Prepare income statements for each year using absorption costing. Reconcile the differences each year in net income under the two costing approaches.

1. Imagine that you are the CEO of Moet Hennessy Louis Vuitton SE (LVMH). You have just received share price valuation estimates for a potential buyout target, Rimowa, from two of your top financial analysts. You have confidence in their estimates because they have taken FIN 305 from the Shidler College of Business. Both analysts used the discounted cash flow (DCF) model to estimate the share price resulting in a valuation of $50, by the first analyst and $60, by the second analyst.

Part I: Identify two possible causes for the significant difference in valuation and briefly explain how each possible cause affected the DCF model’s share price estimate.