Frank operates a construction business in Dallas, Texas. On May 1, 2019, Frank purchased a warehouse for his business. The warehouse cost $1,500,000 ($500,000 for land and $1,000,000 for improvements). In November 2019, Frank purchased the following business property: equipment for $100,000, light-duty truck for $50,000, and office furniture and equipment for $50,000. Please calculate Frank’s 2019 depreciation deductions. Be sure to explain your calculations fully.

What income would Frank report if he decided to sell the warehouse and equipment on January 1, 2021 so he could upgrade the business? Assume he could sell the warehouse for $1,500,000 and the equipment for $190,000 ($95,000 for equipment, $47,500 for truck, and $47,500 for office furniture and equipment).  Be sure to fully explain your answer.

On 1/04/2019, AUS Ltd enters into a binding agreement with a Canadian company to construct an item of machinery that manufactures spoons. The cost of the machinery is $400,000 Canadian Dollars. The construction of the machinery is completed on 1/06/2020 and shipped FOB Canada on that date. The debt is unpaid at 30 June 2020, which is also AUS Ltd’s end of reporting period. The exchange rates at the relevant dates are: • 01/04/2019 A$1.00 = C$1.10 • 30/06/2019 A$1.00 = C$1.05 • 01/06/2020 A$1.00 = C$1.02 • 30/06/2020 A$1.00 = C$1.00 Required: Provide the required journal entries for the above transactions. (7 marks, word limit: n/a) Please provide unique answer than others.

During 2020, Maria Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2020 were $8,347,000. The company had the following debt outstanding at December 31, 2020:

Compute the amounts of each of the following.

Cardiff and Delp is an architectural firm that provides services for residential construction projects. The following data pertain to a recent reporting period.
  

Required:
1. & 2. Using ABC, compute the firm's activity overhead rates. Form activity cost pools where appropriate. Assign costs to a 8,800-square-foot job that requires 490 contact hours, 356 design hours, and 210 days to complete. (Round activity rate answers to 2 decimal places.)

The common stock of Buildwell Conservation & Construction Inc. (BCCI) has a beta of 0.9. The Treasury bill rate is 4%, and the market risk premium is estimated at 8%. BCCI’s capital structure is 38% debt, paying an interest rate of 7%, and 62% equity. The debt sells at par. Buildwell pays tax at 21%.

a. What is BCCI’s cost of equity capital? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

b. What is its WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

c. If BCCI is presented with a normal project with an internal rate of return of 12%, should it accept the project if it has the same level of risk as the current firm?

Alvin Construction manufactures small tractors on an assembly-line basis. The units are started
in Department Y. On January 1 of this year, the Work-in-Process inventory of Department Y
consisted of 200 units 100% complete as to materials and 20% complete as to conversion.
During the month, 800 units were started and 500 units were completed and transferred out. The
Work-in-Process on January 31 was 100% complete as to materials and 20% complete as to
conversion.
Costs in process at the beginning of the period amounted to $100,000 for materials and $25,000
for conversion. Costs added during the period were materials costs of $200,000 and conversion
costs of $143,000.
Required
1. Prepare a production cost report using the weighted-average method. Round answer to 4
decimal places.
2. Prepare the journal entries.

1. In 2010, LinkedIn reported trade payable obligations totaling $10.8 million in other accrued expenses within accrued liabilities instead of accounts payable. In 2011, note 2 in the 10-K financial statements described the use of accrued liabilities instead of accounts payable as a classification. Do you believe LinkedIn’s accounting qualifies as a financial shenanigan?

2. Tineseltown Construction just received a $2 billion contract to construct a modern football stadium in the City of Industry, located in southern California, for a new National Football League (NFL) team called the Los Angeles Devils of Industry. The company estimates that it will cost $1.5 billion to construct the stadium. Explain how Tineseltown can make revenue recognition decisions each year that enable it to manage earnings over the three-year duration of the contract.

The action plan in the Boston Bike Network Plan anticipates spending $30 million in construction costs for work on establishing and renovating 100 miles of bike lanes in the city. The overall goal of the Boston Climate Action Plan is to reduce vehicle miles traveled (VMT) by 5.5% from 2005 levels, which would result in an estimated reduction of 68 thousand tons of CO2 per year. Assume the bike paths and VMT effects last for 30 years, the value of CO2 reduction is $40 per ton (based on another study), and the discount rate is 5%. In years 10 and 20, 10% of the original capital cost is spent for maintenance.

a. Calculate the B/C ratio, net present value, and internal rate of return for the bike path network.

1.     Eastman Publishing Company is considering publishing an electronic textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and Web site construction is estimated to be $160,000. Variable processing costs are estimated to be $6 per book. The publisher plans to sell access to the book for $46 each. Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand = 4000-6*p where p is the price of the e-book.

Build a spreadsheet model to calculate the profit/loss for a given price.

Use goal seek to compute the price that results in break even

Use a data table that varies price from $50 to $400 increment of $25 to find the price that maximizes profit.

***Please show the formula in Excel.

A specialty concrete mixer used in construction was purchased for $300,000 7 years ago. Its annual O&M costs are $105,000. At the end of the 8-year planning horizon, the mixer will have a salvage value of $5,000. If the mixer is replaced, a new mixer will require an initial investment of $375,000. At the end of the 8-year planning horizon, it will have a salvage value of $45,000. Its annual O&M cost will be only $40,000 due to newer technology. Analyze this using an EUAC measure and a MARR of 15% to see if the concrete mixer should be replaced if the old mixer is sold for its market value of $65,000.

Part a

Use the cash flow approach (insider’s viewpoint approach).

Show the EUAC values used to make your decision:

1- Existing concrete mixer: $ ??????????????

2- New concrete mixer: $ ??????????????