Ng Corporation produces and sells only one product; its selling price is $100 and its variable cost is $60 per unit. The company’s monthly fixed expense is $35,000.

Required:

1. Using the equation method, determine the unit sales that are required to earn a target profit before tax of $4,000.

2. Using the formula method, determine for the dollar sales that are required to earn a target profit before tax of $5,000.

3. Using the formula method, calculate the number of units that need to be sold to earn an after-tax income of $6,000, assuming a tax rate of 25%.

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $15,600 and accumulated E&P of $20,750 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $20,750 distribution (the remaining shareholders received $31,125 in distributions). (Assume her stock basis is $41,500 after considering her share of Bombay’s income for the year but before considering the effects of the distribution.) Required: What is the amount and character of gain Nicolette must recognize from the distribution? What is her basis in her Bombay stock at the end of the year?

During the power stroke in a four-stroke automobile engine, the pis-ton is forced down as the mixture of combustion products and air undergoes an adiabatic expansion. Assume (1) the engine is running at 2500 cycles/min; (2) the pressure immediately before the expansion is 20.0 atm; (3) the volumes of the mixture immediately before and after the expansion are 50.0 cm3and 400 cm3, respectively ; (4) the time interval for expansion is one-fourth that of the total cycle; and (5) the mixture behaves like an ideal gas with specific heat ratio 1.40. Find the average power generated during the power stroke.

Question 1
Balances of account for Chin Chai Smartshop as at 31 December 2010 are shown below:
RM
Cash 800
Debtors 5,800
Creditors 9,940
Stocks as at 1 January 2010 5,985
Insurance 360
Office equipment at cost 8,000
Provisions for depreciation for office equipment 800
Import duty 540
Commission received 1,580
Vehicles at cost 12,000
Provisios for depreciation for vehicles 1,200
Return inwards 780
Return outwards 695
Purchases 39,950
Sales 67,575
Bank 13,600
Discount received 420
Discount allowed 485
Salary and wages 3,930
General expenses 425
Rental received 7,800
Vehicles maintenance 1,350
Drawings 675
Bad debts 150
Provision for doubtful debts 225
Shop building 35,000
Maintenance of shop building 300
Capital ?








Additional information:
1) Stock as at 31 December valued at RM5,995.
2) Office equipment and vehicles will be depreciated at 10% per annum using reducing balance method.
3) Provisions for doubtful debts were adjusted at 3% on total debtors.
4) Drawings of cash amounting RM420 for personal used has not been recorded in any books of accounts yet.
5) Accrued commission received is RM55.
6) Part of the shop was rental out to third party at agreed rate of RM600 per month.
7) Salary and wages was underpaid for the month of December by RM1,600.

Required:

a) Calculate the capital amount as at the date.                                                        

b) Income Statement for the year ended 31 December 2010.                               

c) Balance sheet as at the date.                                                                            
(Total: 25 Marks)

On December 31, 2013, the Mallory Corporation had the following activity in its fixed assets

record. Assume all assets were purchased on January 1.

REQUIRED:

· Compute the depletion, amortization, and depreciation expense on December 31, 2013 for each asset listed above.

· Record the entries for the assets above

· Suppose that we sold machine 2 for $50,000, record the entry

· Suppose that the building life increased from 25 years to 30 years, revise the depreciation and prepare the entry.

· Suppose that the corporation spent $20,000 in 2013 to defend the patent.  Record the entry.

Use this information for New Tech Company to answer the following question. You may (or may not) need to fill in missing information.

          NEW TECH COMPANY

INDUSTRY AVERAGE RATIOS

Which of the following items characterize New Tech Company? (It may be more than one option).

EXPLAIN (and report your calculations) (15 points)

1. High debt & unprofitable
2. Low debt & unprofitable
3. Decreasing profit margin
4. High Asset Utilization Performance
5. Low Asset Utilization Performance
6. Increasing sales with a decreasing sales growth rate
7. 1, 3 and 5 characterize New Tech Company

In 2009, New York First National Bank acquired New Jersey National Bank. In an exchange, New York First National Bank issued three series of preferred stock for New Jersey National Bank's net assets. Series Senior A (the most senior series), was given to four of New Jersey National Bank's creditors so that the debt could then be retired. The four preferred shareholders are listed as follows: two regional banks, one money center bank, and a non-financial corporation. Senior Series A has a total par value of $20 million, which carries a non-cumulative dividend per the following schedule:

New York First National Bank did not pay dividends in 2010, 2011, or 2013 however, they will start paying dividends annually at the start of 2014 thus, they will pay 20% on the Senior Series A preferred.

The Senior Series A stock may be called at any given time, at par plus dividends cumulated from January 1, 2010. New York First National Bank estimates that it can float a new issue of 10% non-cumulative preferred stock at par, with issuance costs amounting to $1,000,000. The new issue of preferred would be callable at par plus unpaid dividends.

Should New York First National Bank call in the Senior Series A and issue new preferred? (assume that the Senior Series A would be called effective December 31, 2013.)

3. Inflation a) What is the difference between real and nominal GDP? _______________________________________________________________ _______________________________________________________________

b) Suppose the base year is 2005, and the only goods in the economy are apples and bananas. In 2005 both apples and bananas cost $1, and 100 apples and 100 bananas are produced. In 2006, apples cost $20 and bananas cost $5, and 50 apples and 200 bananas are produced.

1. What is nominal GDP in 2005? _______ In 2006? _______ 2. What is real GDP in 2005? _______ In 2006? _______

3. What is the GDP deflator in 2005? _______ In 2006? _______

4. Suppose the fixed basket of goods is 1 apple and 2 bananas. 5. What is the level of the CPI in 2005? _______ In 2006? _______ 6. What is the CPI inflation rate from 2005 to 2006? _______

c) What are the three effects that bias the measurement of CPI? i. _____________________ ii. _____________________ iii. _____________________

d) Which of the three effects listed in part c does each of the following illustrate? 1. US households in 2010 spent a larger fraction of their income on televisions than they did in 1950. __________________________ 2. All televisions available in 2010 had higher resolution than any televisions available in 1950. __________________________ 3. In 1950, no US household had a plasma screen television, but in 2010 they are widely available. __________________________

e) Suppose the average television purchased in 1950 cost $200, and the average television purchased today costs $700.

1. What is the percentage change in the average television price? _______

2. Taking into account the effects in part c, is this percentage increase likely an underestimate or overestimate of the true change in the cost of televisions? ____________

3. Why? ____________________________________________________

More time on the Internet: A researcher polled a sample of 1097 adults in the year 2010, asking them how many hours per week they spent on the Internet. The sample mean was 9.42 with a standard deviation of 13.23. A second sample of 1031 adults was taken in the year 2012. For this sample, the mean was 10.63 with a standard deviation of 14.47. Assume these are simple random samples from populations of adults. Can you conclude that the mean number of hours per week spent on the Internet increased between 2010 and 2012? Let μ1 denote the mean number of hours spent on the Internet in 2010 and μ2 denote the mean number of hours spent on the Internet in 2012. Use the =α0.05 level and the P-value method with the table. Part 1 of 6 Your Answer is correct State the appropriate null and alternate hypotheses. H0:=μ1μ2 H1:<μ1μ2 This is a ▼left-tailed test. Part 2 of 6 Your Answer is correct Compute the test statistic. Round the answer to three decimal places. =t −2.01 Part 3 of 6 Your Answer is incorrect How many degrees of freedom are there, using the simple method? The degrees of freedom using the simple method is 1.646. Correct Answer: The degrees of freedom using the simple method is 1030. Part: 3 / 63 of 6 Parts Complete Part 4 of 6 Estimate the P-value. Identify the form of the interval based on Critical Values for the Student's t Distribution Table. ≤p <≤p >p

Question 1: A student at a university wants to determine if the proportion of students that use iPhones is less than 0.34. If the student conducts a hypothesis test, what will the null and alternative hypotheses be?

Question 2: A medical researcher wants to examine the relationship of the blood pressure of patients before and after a procedure. She takes a sample of people and measures their blood pressure before undergoing the procedure. Afterwards, she takes the same sample of people and measures their blood pressure again. The researcher wants to test if the blood pressure measurements after the procedure are different from the blood pressure measurements before the procedure. The hypotheses are as follows: Null Hypothesis: ?_D = 0, Alternative Hypothesis: ?_D ? 0. From her data, the researcher calculates a p-value of 0.678. What is the appropriate conclusion? The difference was calculated as (after - before).

Question 3: Your friend tells you that the proportion of active Major League Baseball players who have a batting average greater than .300 is greater than 0.52, a claim you would like to test. The hypotheses for this test are Null Hypothesis: p ? 0.52, Alternative Hypothesis: p > 0.52. If you randomly sample 27 players and determine that 16 of them have a batting average higher than .300, what is the test statistic and p-value?