Use the information below to answer questions 25-30.

Aggie Oil owns a 100% WI in Lease A.Lease A is burdened with a 1/6 royalty.During the month of October, Aggie Oil estimated a total of 10,000 barrels of oil were produced and sold.Assume the selling price of the oil was $80/bbl and the production tax was 5%.

Additionally, Aggie Oils books estimates until actual can be obtained at settlement.Settlement typically occurs two months after the sale.Upon settlement, Aggie Oil determined that 9,000 volumes were sold in October.Assume Aggie Oil distributes all royalty and tax payments.

25. During which month will you initially record revenue related to this sale (type out the whole month; do not abbreviate)?

QUESTION 26

During which month should cash received be recorded for this sale?

QUESTION 27

In December, determine the amount of serverance tax payable to be reversed from the October estimates.

QUESTION 28

In December, determine the amount of LOE for production (severance) tax to be reversed from the October estimates.

QUESTION 29

In December, determine the amount of oil revenue to be recorded for actuals from the October sale.

QUESTION 30

In December, determine the amount of royalty payable to be recorded for actuals from the October sale.

1. You have completed the Cash Flow statement. Pleased with your work so far, Barry asks you to work on an assignment for Steve Fox, relating to a different Regal subsidiary, Phrygian Equipment Capital. Phrygian has two business segments that are reported separately in its financial statements. The segments are “machinery” and “investment and Insurance.” In its management accounts, the company reports four different divisional results. The four divisions are machinery leasing, machinery sales, investments, and insurance. The results of the segments and the divisions follow:

Steve has asked you for a technical analysis on how Phrygian should report its segment information, under IAS 14, as of its year-end of December 31, 2017

Oct 1 Tom invested cash in the business, $40,000 2 Prepaid 6 months rent in advance, $4,800 3 Purchased Stage Equipment for $3,000. Paid $1,500 immediately but put the rest on account. 5 Purchased supplies for cash, $1,500 7 Purchased a one year insurance policy for $1,200 31 Paid the part-time worker, $450 Nov 2 Tom withdrew $180 so he could relax at the health spa 3 Tuition revenue for the month was, $3,500. Received $1,000 immediately from students the rest is due in 20 days. 8 Paid the telephone bill, $95 11 Paid the electric bill, $320 21 Received payment for tuition from students billed on November 3 23 Received the newspaper advertising bill, $160, it is due in 30 days. 27 Paid the part-time worker, $450 Dec 3 Tuition revenue for the month was, $5,500. Received $2,500 immediately from students, the rest is due in 20 days. 21 Paid the advertising bill which was received last month, $160 22 Received payment for tuition from students billed on December 3 24 Paid an additional $500 on the stage equipment purchased earlier in the year. 29 Purchased additional supplies on account, $300

ABC Corporation has three support departments with the following costs and cost drivers: Support Department Cost Cost Driver Graphics Production $200,000 number of copies made Accounting 500,000 number of invoices processed Personnel 400,000 number of employees ABC has three operating divisions, Micro, Macro, and Super. Their revenue, cost, and activity information are as follows: Micro Macro Super Revenues $700,000 $850,000 $650,000 Direct operating expenses 50,000 70,000 100,000 Number of copies made 20,000 30,000 50,000 Number of invoices processed 700 800 500 Number of employees 130 145 125 The support department allocation rate for the Accounting Department is a.$714 b.$250 c.$625 d.$0.004

ABC Corporation has three support departments with the following costs and cost drivers:

ABC has three operating divisions, Micro, Macro, and Super. Their revenue, cost, and activity information are as follows:

The support department allocation rate for the Personnel Department is

a.$2,758

b.$1,000

c.$3,200

d.$3,077

ABC Corporation has three support departments with the following costs and cost drivers:

ABC has three operating divisions, Micro, Macro, and Super. Their revenue, cost, and activity information are as follows:

The support department cost that will be allocated to the Micro Division is

a.$145,000

b.$345,000

c.$60,000

d.$200,000

ABC Corporation has three support departments with the following costs and cost drivers:

ABC has three operating divisions, Micro, Macro, and Super. Their revenue, cost, and activity information are as follows:

The support department cost that will be allocated to the Macro Division is

a.$305,000

b.$405,000

c.$130,000

d.$175,000

Terms of a lease agreement and related facts were as follows:

1. The lease asset had a retail cash selling price of $124,000. Its useful life was six years with no residual value (straight-line depreciation).
2. Annual lease payments at the beginning of each year were $25,883, beginning January 1.
3. Lessor’s implicit rate when calculating annual rental payments was 10%.
4. Costs of $2,561 for legal fees for the lease execution were the responsibility of the lessor.

Required:
Prepare the appropriate entries for the lessor to record the lease, the initial payment at its beginning, and at the December 31 fiscal year-end under each of the following three independent assumptions:

1. The lease term is three years and the lessor paid $124,000 to acquire the asset (operating lease).
2. The lease term is six years and the lessor paid $124,000 to acquire the asset (sales-type lease). Also assume that adjusting the lease receivable (net investment) by initial direct costs reduces the effective rate of interest to 9%.
3. The lease term is six years and the lessor paid $97,000 to acquire the asset (sales-type lease).

Required 1

1. 01/01: Record the gross lease revenue received by lessor.

2. 01/01: Record the negotiating costs incurred by lessor.

3. 12/31: Record the lease revenue for lessor.

4. 12/31: Record the cost of the lease to the lessor.

5. 12/31: Record the depreciation for lessor.

Required 2

1. 01/01: Record the beginning of the lease for lessor.

2. 01/01: Record the negotiating costs incurred by lessor.

3. 01/01: Record the gross lease revenue received by lessor.

4. 12/31: Record the interest revenue for lessor.

Required 3

1. 01/01: Record the beginning of the lease for lessor.

2. 01/01: Record the negotiating costs incurred by lessor.

3. 01/01: Record the gross lease revenue received by lessor.

4. 12/31: Record the interest revenue for lessor.

For questions 2-7: state the appropriate hypotheses; conduct a hypothesis test using α = 0.05 utilizing the classical approach, confidence interval approach, or p-value approach; state the decision regarding the hypotheses; and make a conclusion.

3. (15 pts) In a study of schizophrenia, researchers measured the activity of the enzyme monoamine oxidase (MAO) in the blood platelets of 18 patients. The results (expressed as nmol benzylaldehyde product per 108 platelets) were as follows:

6.8 8.4 8.7 11.9 14.2 18.8

9.9 4.1 9.7 12.7 5.2 7.8 7.8

7.4 7.3 10.6 14.5 10.7

The researchers believe that the average MAO level should be 7.5 amongst the general population, which is assumed to follow a normal distribution. Elevated MAO levels are considered abnormal.

7. (15 pts) The manager of a fast-food restaurant claims that the average service time is less than 90 seconds. A random sample of customers is selected and their wait times are reported as follows:

56 78 66 78 99 114 106 92 45 102

119 84 88 118 99 61 55 79 108 46

75 102 70 74 72 113 83 78 105 81

1) critically differentiate between forward and future contracts.

2 a ltd intends buy 10,000 Rands in three months time . the following information is available.

sport rate 0.67,the forward rate in three months is 0.7, how can a ltd hedge against foreign exchange fluctuation clearly explaining the implication to ltd should the sport rate in three months time be more or less than the forward rate?

3) differentiate between the following types of markets.

a)capital and money markets

b) primary and secondary markets

c) bond and equity markets

ABC Ltd is a wholesaler of furniture which has been in operation for ten years. It buys furniture from five major manufacturers and sells them to a range of customers. The company currently has a customer base of over 500 customers most of which are credit customers. The receivables balance comprises customers owing up to $2,000,000 to smaller balances of about $10,000, all with many different due dates for payments and credit limits. The level of receivables is considerably higher than last year and there are concerns about the creditworthiness of some customers.

The company has only recently computerised its operations including its accounting system. Manual invoices, receipts and cheques have been replaced with computer-generated documents. The sub-ledgers are now maintained in the accounting software which have facilitated more timely generation of statements much to the delight of customers. The sales process is initiated by a Purchase Order from the customer which is used to raise a system generated Sales Invoice and Delivery Slip. A copy of the Delivery Slip is given to the Security at the gate for logging and check off to allow passage of goods through the gate; another copy of the Delivery Slip is given for the customer to sign and then returned to the Sales Dept. All information is stored on ABC Ltd’s computer systems. There is no backup of data off site. The client’s staff are helpful although they cannot confirm completeness of documentation for the system.

You are the audit senior in charge assigned for ABC Ltd’s audit and you are in the process of planning the current year’s audit. You are contemplating the changes in the client’s audit environment and the impact that these changes will have on the audit risk and the audit methodology. Your audit assistant is curious why it is necessary to plan the audit from one year to the next. Why not just copy the previous year’s workpapers?

(c) State the approach for auditing in a computerized environment which you are using to design tests for testing controls over processing of data. Explain the reason for your choice, highlighting the benefits and drawbacks. State any assumption made as to resource availability.

(d) Explain how the choice of approach in (c) above is likely to impact audit risk? Identify the audit risk component which is most likely to be affected.

3. (a) Your audit plan notes that you will be testing the system of internal controls for the ‘three Es’. Explain the ‘three Es’ and the impact these will have on the audit if positive and if negative.

(b) State the audit procedure you will be using for the following:
i) To test the control over completeness of sales
ii) To test the accuracy and existence of receivables balances

(c) List the set of management assertions for “Sales” and “Accounts Receivable” which you will be testing.

1. What is the difference between Structural unemployment and Frictional Unemployment
2. What is the difference between fiscal policy and monetary policy?
3. List the three components of M1
4. What is Open Market Operation

the cpompany has customers make a 20% deposit on items made. This deposit is credited to the Unearned Sales Account when received. Customers pay the remaining balance (80% of the selling price) once the product is done and delivered. On june 1, 2016, the Unearned Sales account had a credit balance of $180,000. During June and July 2016, total customer deposits made for products to be delivered in the future amounted to $400,000 and $480,000.

Questions: (please explain answers, not just give. thank you!!!)

What account would be debited when customer deposits are received?

What account would be credited when the customer deposits are received?

During june and july 2016, the company completed and delivered goods worth $800,000 and $1,200,000, for which customer deposits had been received. (Note: $800,000 and $1,200,000 is the total selling price including the 20% deposit) What is the total sales revenue recognized for june and july As of june 31, what is the balance of the Unearned Sales account?

As of july 30th, what is the balance of the Unearned Sales account? ( The best way to answer 5and6 is to construct a 3 column ledger )