Students, please view the "Submit a Clickable Rubric Assignment" in the Student Center. Instructors, training on how to grade is within the Instructor Center. Assignment 1: Client Letter Due Week 2 and worth 150 points Imagine that you are a Certified Public Accountant (CPA) with a new client who needs an opinion on the most advantageous capital structure of a new corporation. Your client formed the corporation in question to provide technology to the medical profession to facilitate compliance with the Health Insurance Portability and Accountability Act (HIPAA). Your client is very excited because of the ability to secure several significant contracts with sufficient capital. Use the Internet and Strayer databases to research the advantages and disadvantages of debt for capital formation versus equity for capital formation of a corporation. Prepare a formal letter to the client using the six (6) step tax research process in Chapter 1 and demonstrated in Appendix A of your textbook as a guide. Write a one to two (1-2) page letter in which you: Compare the tax advantages of debt versus equity capital formation of the corporation for the client. Recommend to the client whether he / she should use debt or equity for capital formation of the new corporation, based on your research. Provide a rationale for the response. Your assignment must follow these formatting requirements: Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions. Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length. The specific course learning outcomes associated with this assignment are: Analyze tax issues regarding corporate formations, capital structures, income tax, non-liquidating distributions, or other corporate levies. Use technology and information resources to research issues in organizational tax research and planning. Write clearly and concisely about organizational tax research and planning using proper writing mechanics. View comments (1)

Carlie needed a personal computer (PC) for school but her budget was tight, so she decided on a used machine. After some searching, she was down to two possibilities. One she had found in a national franchized computer store, where she could purchase the PC for $800 with a one-year guarantee. But she was intrigued by a second possibility: a local charity store was offering a used machine that had been donated (exactly the same model as in the store) for $500.

Carlie talked to a computer repair specialist, who said the principal problem with this model of PC was the hard drive, which was prone to failure: he estimated that half of the PCs of this model and age would require a new drive. He offered to test the computer and check the condition of the drive for $60. If the drive was no good, a new drive could be fitted for $300 and would be guaranteed for one year. He added a qualification that his testing was not perfect: about 25% of drives that passed his testing failed soon afterwards requiring a new drive ($300) plus a service charge of $100 for diagnosing the problem (a cost that has to be paid with the fitting of a new drive).

Please only enter an integer if a numerical answer is required.

Emma Emerson is a proud woman with a problem. Her daughter has been accepted into a prestigious law school. While Ms. Emerson is proud of her daughter, she is worried sick about paying for the education - she is a single parent who has worked hard to raise her 3 children. She had to go heavily into debt to finance her own education. Even though she now has a good job, her family's needs continue to outpace her income and her debt burden is staggering. She knows she will be unable to borrow the money needed for her daughter's education.

Ms. Emerson is the chief financial officer (CFO) of a small manufacturing company. She has just accepted a new job and she hasn't notified her boss yet that she will be leaving in a month. She is concerned that her year-end bonus may be affected if her boss learns of her plan to leave. She knows her behavior is less than honorable but she believes that she in entitled to the bonus. Her boss makes twice what she does! She is considering an opportunity to boost the bonus.

Ms. Emerson's bonus is based on a percentage of net income. Her company recently introduced a new product line that required substantial start-up costs. GAAP requires these costs to be expensed in the current accounting period but if the costs are classified as product cost, net income will be higher. By the time the auditors discover the misclassification, Ms. Emerson will be at her new job. If her new employer hears about it, she can just claim ignorance.

Required:

1. Based on this information, do you think Ms. Emerson believes the number of units sold will be equal to, less than or more than production this year? Explain your logic.

2. Explain how the misclassification could mislead an investor or a creditor regarding the company's financial condition.

3. Explain how the misclassification could affect income taxes.

4. Review the Statement of Ethical Professional Practice shown in Exhibit 10.17 - is Ms. Emerson's misclassification of the start-up costs a violation of this statement?

The El Dorado Star is the only newspaper in El Dorado, New Mexico. Certainly, the Star competes with The Wall Street Journal, USA Today, and the New York Times for national news reporting, but the Star offers readers stories of local interest, such as local news, weather, high-school sporting events, and so on. The El Dorado Star faces the revenue and cost schedules shown in the spreadsheet that follows: A template for the spreadsheet is provided in the Course Materials. You may download my template or create your own. Since we are using dollars and cents, be sure to go out two decimal places on your calculations. Add columns to show, respectively, marginal cost (MC), marginal revenue (MR), and total profit

What price should the manager of the EI Dorado Star charge? How many papers should be sold daily to maximize profit?

At the price and output level you answered in the previous question, is the EI Dorado Star making the greatest possible amount of total revenue? Is this what you expected? Explain why or why not.

Use the appropriate formulas to create two new columns (7 and 8) for total profit and profit margin, respectively. What is the maximum profit the EI Dorado Star can earn? What is the maximum possible profit margin? Are profit and profit margin maximized at the same point on demand?

What is the total fixed cost for the El Dorado Star? Explain how you arrived at this conclusion.

Create a new spreadsheet in which total fixed cost increases to $5,000. What price should the manager charge? How many papers should be sold in the short run?

Ben Bates graduated from college six years ago with a finance undergraduate degree. Although he is satisfied with his current job, his goal is to become an investment banker. He feels that an MBA degree would allow him to achieve this goal. After examining schools, he has narrowed his choice to Wilton University. Although internships are encouraged by the school, to get class credit for the internship, no salary can be paid. Other than internships, the school will not allow its students to work while enrolled in its MBA program.

Ben currently works at the money management firm of Dewey and Louis. His annual salary at the firm is $65,000 per year, and his salary is expected to increase at 3 percent per year until retirement. He is currently 28 years old and expects to work for 40 more years. His current job includes a fully paid health insurance plan, and his current average tax rate is 26 percent. Ben has a savings account with enough money to cover the entire cost of his MBA program.

The Ritter College of Business at Wilton University is one of the top MBA programs in the country. The MBA degree requires two years of full-time enrollment at the university. The annual tuition is $70,000, payable at the beginning of each school year. In addition, books and other supplies are estimated to cost $3,000 per year, payable at the beginning of each year. Ben expects that after graduation from Wilton, he will receive a job offer for about $110,000 per year, with a $20,000 signing bonus. The salary at this job will increase at 4 percent per year. Because of the higher salary, his average income tax rate will increase to 31 percent.

The school offers a health insurance plan that will cost $3,000 per year, payable at the beginning of the year. Ben also estimates that room and board expenses will cost $2,000 more per year than his current expenses, payable at the beginning of each year. The appropriate discount rate is 4.7 percent.

Question: Assuming all salaries are paid at the end of each year, what is the best option for Ben — remaining at his current job or pursuing an MBA —from a strictly financial standpoint?

Twenty years​ ago, 46​% of parents of children in high school felt it was a serious problem that high school students were not being taught enough math and science. A recent survey found that 190 of 750 parents of children in high school felt it was a serious problem that high school students were not being taught enough math and science. Do parents feel differently today than they did twenty years​ ago? Use the alpha equals 0.05 level of significance.Because

np 0 left parenthesis 1 minus p 0 right parenthesis equals186.3 greater than equals less than not equals greater than

​10,

the sample size is

less than

less than

greater than

​5% of the population​ size, and the sample

can be reasonably assumed to be random,

cannot be reasonably assumed to be random,

can be reasonably assumed to be random,

is given to be random,

is given to not be random,

the requirements for testing the hypothesis

are

are not

are

satisfied.

​(Round to one decimal place as​ needed.)

What are the null and alternative​ hypotheses?

Upper H 0

​:

p

p

mu

sigma

equals

not equals

less than

greater than

equals

. 46versus

Upper H 1

​:

p

p

mu

sigma

not equals

equals

not equals

less than

greater than

. 46

​(Type integers or decimals. Do not​ round.)

Find the test statistic.

z 0

equalsnothing

​(Round to two decimal places as​ needed.)

Find the​ P-value.

​P-valueequals

nothing

​(Round to three decimal places as​ needed.)

Determine the conclusion for this hypothesis test. Choose the correct answer below.

A.

Since

​P-valuegreater than alpha

​,

reject

the null hypothesis and conclude that there

is not

sufficient evidence that parents feel differently today.

B.

Since

​P-valueless than alpha

​,

reject

the null hypothesis and conclude that there

is

sufficient evidence that parents feel differently today.

C.

Since

​P-valueless than alpha

​,

do not reject

the null hypothesis and conclude that there

is

sufficient evidence that parents feel differently today.

D.

Since

​P-valuegreater than alpha

​,

do not reject

the null hypothesis and conclude that there

is not

sufficient evidence that parents feel differently toda

Frank Pulley was the General Manager of Fred Arnold’s, “Arnold’s Moving and Storage”, a family-owned business. He had been with the company since he got out of high school. He worked summers and vacations to make money during his college years. The company had grown as did Frank. When Frank graduated from college with his degree in business management, he was given the job of Office Accounts Manager. He managed the money for the business. During the evening, Frank went to school and received his MBA in Finance. By then, Arnold’s had expanded to include long distance moving as well as office moves in the Mid-Atlantic area. The company was making over $3,000,000 in sales and was growing at a rate of 8% -10 % a year. Competition was strong in the Mid-Atlantic region so Fred wanted to expand southward. About this time, Fred’s son decided it was time to come back into the business. He had been working in IT in Miami. He liked Miami and felt he could work from there and bring the business down the Eastern Seaboard.

Frank had been with the business for 12 years now and felt that with Fred’s son now back in the business, it might be time to leave. Fred saw Frank at lunch one day shortly after Frank started looking for a new job. “Frank, I just heard that you are looking for a senior management position. In fact, I had to hear it from Janice Jeppy of all people. I ran into her at the bank. She says you applied to Jeppy Movers for a job and was wondering why you would want to switch moving companies. I am wondering too. Don’t you want to stay with us?”

Frank was surprised. The thought had never occurred to him. He assumed that Mr. Arnold’s son and daughter would take over the business. Both of Fred’s children had been working in the business since they were in high school. “I don’t want to leave Mr. Arnold,” Frank replied, “but I assumed that with Frank back in the business, he would take over. I just couldn’t see where there was room for advancement.” Fred was afraid this is what the boy would say. His son was bright and showed promise, but Fred knew they needed experienced people like Frank to keep the company moving forward. Frank was great support for the business and would be the best support that he and his son could have. Fred wondered how he could keep Frank in the business. “Come see me tomorrow at 10 a.m., Frank and we will talk. I can’t let you go to Jeppy Movers, can I”?

What Can Fred Arnold do to keep Frank now and in the future? Include in the discussion how the growth of the company will affect Fred’s ideas.

Also, address succession and Frank’s role in the business going forward.

Learning Activity #1

Frank Pulley was the General Manager of Fred Arnold’s, “Arnold’s Moving and Storage”, a family-owned business. He had been with the company since he got out of high school. He worked summers and vacations to make money during his college years. The company had grown as did Frank. When Frank graduated from college with his degree in business management, he was given the job of Office Accounts Manager. He managed the money for the business. During the evening, Frank went to school and received his MBA in Finance. By then, Arnold’s had expanded to include long distance moving as well as office moves in the Mid-Atlantic area. The company was making over $3,000,000 in sales and was growing at a rate of 8% -10 % a year. Competition was strong in the Mid-Atlantic region so Fred wanted to expand southward. About this time, Fred’s son decided it was time to come back into the business. He had been working in IT in Miami. He liked Miami and felt he could work from there and bring the business down the Eastern Seaboard.

Frank had been with the business for 12 years now and felt that with Fred’s son now back in the business, it might be time to leave. Fred saw Frank at lunch one day shortly after Frank started looking for a new job. “Frank, I just heard that you are looking for a senior management position. In fact, I had to hear it from Janice Jeppy of all people. I ran into her at the bank. She says you applied to Jeppy Movers for a job and was wondering why you would want to switch moving companies. I am wondering too. Don’t you want to stay with us?”

Frank was surprised. The thought had never occurred to him. He assumed that Mr. Arnold’s son and daughter would take over the business. Both of Fred’s children had been working in the business since they were in high school. “I don’t want to leave Mr. Arnold,” Frank replied, “but I assumed that with Frank back in the business, he would take over. I just couldn’t see where there was room for advancement.” Fred was afraid this is what the boy would say. His son was bright and showed promise, but Fred knew they needed experienced people like Frank to keep the company moving forward. Frank was great support for the business and would be the best support that he and his son could have. Fred wondered how he could keep Frank in the business. “Come see me tomorrow at 10 a.m., Frank and we will talk. I can’t let you go to Jeppy Movers, can I”?

Learning Activity #2

How might Arnold’s son attempt to engage the business in the Miami community to solidify the company’s move southward?

Explain how small businesses and community support is important to business sustainability?

Becky is a first-year player on a nationally ranked women’s NCAA Division I tennis team. She is six feet tall with a powerful left-handed serve. Her groundstrokes are technically sound, but she makes too many unforced errors. Her volleys are solid, and she moves well for a tall player. As a high school tennis player, Becky always played a great deal in the spring and summer, but never practiced in the fall or winter. In addition, she never participated in junior tennis associations.

In her senior year in high school, Becky won her state high school singles and doubles championship. She was especially dominant in doubles, winning the state finals 6-2, 6-1. It was after these accomplishments that the tennis coach of Major University contacted her about playing collegiate tennis.

The fall season was a rude awakening for Becky. Not only did she not make the starting lineup, but she also did not even make the traveling squad. In addition, she lost every challenge match she played except one. Becky began to feel that maybe she was not such a good tennis player after all. She stopped hanging around with her new college friends because she thought they would not like her since she was such a “loser.”

Compared to the other women on her college tennis team, Becky had very little experience. Most of her teammates had played the junior tennis circuit and had achieved national rankings or, at the very least, sectional rankings. The coach believes Becky is a very talented tennis player, but her lack of experience has held her back. The coach has told her that she is number 9 out of 12 players on the team.

Your role on the team is that of a student sport psychology consultant. One day about three weeks into the spring season, Becky comes to you before practice and says, “I need help. I’ve got no confidence, the coach doesn’t believe in me, and I’m not having any fun. Every time I step on the tennis court, I feel so anxious I could throw up. My heart is pounding, and I can't stop thinking about how likely I am to screw something up.” You set up a time to talk, and the next day meet in your office.

Identify how anxiety, arousal, and stress might play a facilitative or debilitative role in Becky’s performances within the case. Use at least one specific theory to explain your answer.

Identify three intervention strategies that Becky can use to help manage her anxiety, arousal, and/or stress.  For each strategy, discuss why this strategy will work based on relevant theory and research. (please expand on all areas as much as you can)

Skylar and Walter Black have been married for 25 years. They live at 883 Scrub Brush Street, Apt. 52B, Las Vegas, NV 89125. Skylar is a homemaker and Walter is a high school teacher. His W-2 form is located on the next tab. Skylar's Social Security number is 222-43-7690 and Walt's is 700-01-0002. Neither are age 65 or older. The Blacks provide all the support for Skylar's mother, Rebecca Backin (Social Security number 411-66-2121), who lives in a nursing home in Reno, NV and has no income. Walter's father, Alton Black (Social Security number 343-22-8899), lives with the Blacks in Las Vegas. Although Alton received Social Security benefits of $7,600 in 2018, the Blacks provide over half of Alton's support.

The Blacks moved from Maine to Nevada. As a result, they sold their house in Maine on January 4, 2018. They originally paid $76,000 for the home on July 3, 1993, but managed to sell it for $604,000. They spent $13,000 on improvements over the years. They are currently renting in Las Vegas while they look for a new home.

The school district reimbursed Walter $550 for moving expenses. These are reflected on his W-2 (see separate tab). Walter’s previous job, as a high school teacher in Maine, was only 5 miles from his home. Skylar was unemployed prior to the move.

The Blacks received a 1099-DIV from their mutual fund investments (see separate tab).

The Blacks own a ski condo located at 123 Buncombe Lane, Brian Head, UT 84719. The condo was rented for 184 days during 2018 and used by the Blacks for 16 days. Pertinent information about the condo rental is as follows:

Required:
Complete Form 1040 and the schedules and forms provided for the Blacks.

• Assume the taxpayers had health coverage for the entire year.
• Neither taxpayers wants to contribute to the presidential election campaign.
• If an amount box does not require an entry or the answer is zero, enter "0".
• Do not round any percentages.
• If required, round your answers to the nearest dollar.
• If required, enter a "loss" as a negative number on the tax form. Do not enter deductions as negative numbers.
• Special instructions for Form 8582: If required, use the minus sign to enter a "loss" as a negative number on the lines 1d, 4 and 16. However, per the instructions on the tax return, enter all numbers in Part II as positive amounts.

-------------------------------Complete Form 1040, Schedule 1, Schedule D, Form 8949, Schedule E, Form 8582--------------------------------------------------------------------------------