Janine is a wholesale yarn salesperson working the northeastern US. Her territory covers all of Pennsylvania, New York, New Jersey, Washington, D.C., and Ohio. She lives in Harrisburg, PA with her husband and three children. Janine enjoys her job and loves being out on the road and meeting yarn shop owners and knitters. However, her employer, White Mountain Yarns, requires her to drive to Detroit for a monthly staff meeting; maintain an office outside of her home; complete redundant paperwork due to outdated systems; and often sets her store visit schedule in a way that results in a lot of backtracking, all of which cut into the time she has to build rapport with store owners and individual buyers of the products. The company also doesn't let her hold virtual client meetings, even though clients want them and they would save considerable time and money. Janine is one of the top 5 salespeople and her customers rave about her, however the company is making her job difficult. She doesn't want to quit her job, but many of the antiquated aspects have led her to consider either quitting or asking to be cut back to part time so she can have a better work life balance. Using the concepts, write up a proposal to redesign and/or enrich Janine’s job.

Blackberry Corporation sold $2,500,000 of 10 year 8% bonds on January 1, 2018.  The bonds were dated January 1, 2018 and pay interest on July 1 and January 1.  Blackberry uses the straight-line method to amortize and bond premium or discount.  Blackberry’s year end is December 31.

Instructions:

a.         Prepare all the necessary journal entries to record the issue of the bonds and bond interest expense for 2018, assuming:

            1.         that the bonds sold at 100 (face value)

            2.         that the bonds sold at 103

            3.         that the bonds sold at 96

b.         Show what the Balance Sheet would look like on December 31, 2018 for each bond issue.

Matt Winne​, Inc. issued $700,000 of 9​%, five​-year bonds payable on January​ 1, 2018.

The market interest rate at the date of issuance was 6​%, and the bonds pay interest semiannually.

a) The company received a grant worth RM6,000 on 15 December 2018. It was an incentive by the government for retraining a group of its employees. The three-month training started in December 2018 has a cost of RM10,000 a month.

None of the transactions related to the above has been recorded.

b) Included in the long-termloans is a loan worth RM4,000,000 at 5% annual interest, granted by a local bank on 1 August 2018, for five-year period. Instalment for the month of December 2018 has not been paid yet and the related interest for the instalment was RM15,200.

None of the transactions related to the above has been recorded.

Required:

Show the necessary adjusting journal entries for the additional information above.

On Jan 2, 2018, Sandstone Enterprises purchased equipment for $129,200. The equipment has a useful life of four years or of 13,000 working hours and after the useful life it will have a residual value of $13,500. The machine was used for 1,900 hours in 2018, 2,800 hours in 2019; 3,700 hours in 2020.

Required:

1. Calculate the depreciation expense for 2018 and 2019 under each of the following methods:

1. Straight-line,
2. Double diminishing-balance, and
3. Units-of -production

2. Record the journal entry for depreciation expense for the year ended December 31, 2018 under the straight-line method. (2 marks)
3. Which method results in the lowest profit for the first two years? Why?

Tangshang Industries production budget from the 2^nd quarter of 2018, projected the following amounts of units to be produced:

April 1,000 units

May    1,200 units

June    1,250 units

Each unit requires 2 parts of component A and 3 parts of component B. Component A cost is $1.25 per unit and component B cost is $.80 per unit.

A. Calculate the Direct Material budgeted cost for May 2018

B. Calculate the Direct Material budgeted cost for the quarter April - June 2018

C. The raw materials inventory policy is 0 ending inventory, 0 beginning inventory. How much inventory of component A is required in April 2018?

Chapter 11 Operational Assets: Utilization and Impairment

Jackson Company purchased a new piece of equipment on July 1, 2018 at a cost of $36,000. The equipment has an estimated useful life of 10 years and an estimated residual value of $6,000. During its ten-year useful life, the equipment is expected to produce 500,000 units. The equipment actually produced the following number of units: 2018, 25,000; 2019, 84,000; and 2020, 90,000.

(a) Calculate depreciation expense for 2018, 2019, and 2020 assuming Jackson uses sum-of-the-years’-digits depreciation.

(b) Calculate depreciation expense for 2018, 2019, and 2020 assuming Jackson uses double-declining balance depreciation.

Information from the financial statements of Henderson-Niles Industries included the following at December 31, 2018:

Henderson-Niles’s net income for the year ended December 31, 2018, is $900 million. The income tax rate is 40%. Henderson-Niles paid dividends of $2 per share on its preferred stock during 2018.

Required:
Compute basic and diluted earnings per share for the year ended December 31, 2018.

1. The following is an excerpt from the Freight Train, Inc.’s 2019 annual report:

Required

1. Calculate the debt-to-equity ratio for Freight Train, Inc. for 2019 and 2018 based on year end values of debt and equity.

b.   The present values of the operating leases totaled $6,192 and $6,448 in 2019 and 2018, respectively. Assume that the leases were capitalized (were included in the total amount of debt reported). Recalculate the debt-to-equity ratio for Freight Train, Inc. for 2019 and 2018 without including the operating leases. Does capitalizing the leases improve or worsen the company’s risk perception?