Questions
Case Study 1 Having spent 20 years in a US based company as Chief Accountant, Mohammed...

Case Study 1
Having spent 20 years in a US based company as Chief Accountant, Mohammed faced a lot of challenges upon joining the VH Manufacturing Company in his hometown in India. He was appointed as Chief Accountant and, at the same, was also involved in coordinating the various projects of the company outside the country. Basically, Mohammed followed US-GAAP based guidelines for financial reporting in his earlier portfolios, hence shifting to a new company posed him challenges as he must follow IFRS guidelines for financial reporting. Though both the US GAAP and IFRS are authoritative statements, there were significant differences in the guidelines. Mohammed believed that adopting US GAAP is more comfortable as it provided him detailed and specific rules for financial reporting, which is not the case with IFRS.
It was during an internal audit carried out in the accounting department, the auditors came out with a report of the following observations related to treating various revenue and expenses.
1. All the expenses towards the repair and maintenance of plant and machineries are treated as operating expenses in the financial statements.
2. Mohammed was strict in reporting revenues; hence, the revenues were under- estimated. As per the audit, they estimated that RO240,000 which the company may consider as revenue from the various projects are reported as unearned revenue (customer advances).
3. The company used the FIFO method for valuing inventory consistently over the last few years. Since Mohammed joined the company, he has used LIFO method for valuing inventory.
4. During the year, the company has taken a loan for capital expenditure, but due to a temporary cash crunch the money was used the cash to pay salaries to the staff. The issued was discussed with the bank and thereafter the bank has issued a letter instructing the company to repay the loan on the grounds of violation of the covenant/loan agreement. Mohammed has reported the loan as non-current liability in the financial statements.
5. While writing off impairment losses, Mohammed has used two-step method for write- offs as he mentioned that this was the practice he followed in the previous company where he worked.
The management called Mohammed for an explanation regarding the above observations. Yasir, a friend of Mohammed, has been always a critic of using accounting standards. He considered that adherence to the conceptual frameworks are not necessary to prepare reliable financial statements. As the purpose of financial statements is to communicate the financial results and financial position to internal and external stakeholders, the organization should
|Page4
follow a customized accounting framework that best suits it instead of using accounting standards set by international bodies.
Based on the above case, answer the following;
(Maximum word count for Case Study is 400 Words)
(3+4+3 = 10 Marks)
1. “Mohammed believed that adopting US GAAP is more comfortable as it provides the accountant a detailed and specific guideline for financial reporting, which is not the
case with IFRS”. Do you agree with Mohammed? Justify your answer.
2. Do you consider that Mohammed followed IFRS while preparing the financial statements? (The arguments should be based on the findings of the auditor. Briefly discuss each of the auditor’s observation and verify whether Mohammed followed the
prescribed reporting standards.
3. In your opinion, do you consider that accounting standards are required for preparing
financial statements? Do you think that following accounting standards (for example, reporting fixed assets at their cost price less accumulated

In: Accounting

Curve-fitting Project - Linear Model ***CHOOSE A TOPIC****SEE BELOW Instructions For this assignment, collect data exhibiting...

Curve-fitting Project - Linear Model ***CHOOSE A TOPIC****SEE BELOW

Instructions

For this assignment, collect data exhibiting a relatively linear trend, find the line of best fit, plot the data and the line, interpret the slope, and use the linear equation to make a prediction. Also, find r2 (coefficient of determination) and r (correlation coefficient). Discuss your findings. Your topic may be that is related to sports, your work, a hobby, or something you find interesting. If you choose, you may use the suggestions described below.

A Linear Model Example and Technology Tips are provided in separate documents.

MY TOPIC IS: The rising Homeless population of the United States from 2010 to 2018. PLEASE CITE DATA SOURCES as well if possible

Tasks for Linear Regression Model (LR)

(LR-1) Describe your topic, provide your data, and cite your source. Collect at least 8 data points. Label appropriately. (Highly recommended: Post this information in the Linear Model Project discussion as well as in your completed project. Include a brief informative description in the title of your posting. Each student must use different data.)

The idea with the discussion posting is two-fold: (1) To share your interesting project idea with your classmates, and (2) To give me a chance to give you a brief thumbs-up or thumbs-down about your proposed topic and data. Sometimes students get off on the wrong foot or misunderstand the intent of the project, and your posting provides an opportunity for some feedback. Remark: Students may choose similar topics, but must have different data sets. For example, several students may be interested in a particular Olympic sport, and that is fine, but they must collect different data, perhaps from different events or different gender.

(LR-2) Plot the points (x, y) to obtain a scatterplot. Use an appropriate scale on the horizontal and vertical axes and be sure to label carefully. Visually judge whether the data points exhibit a relatively linear trend. (If so, proceed. If not, try a different topic or data set.)

(LR-3) Find the line of best fit (regression line) and graph it on the scatterplot. State the equation of the line.

(LR-4) State the slope of the line of best fit. Carefully interpret the meaning of the slope in a sentence or two.

(LR-5) Find and state the value of r2, the coefficient of determination, and r, the correlation coefficient. Discuss your findings in a few sentences. Is r positive or negative? Why? Is a line a good curve to fit to this data? Why or why not? Is the linear relationship very strong, moderately strong, weak, or nonexistent?

(LR-6) Choose a value of interest and use the line of best fit to make an estimate or prediction. Show calculation work.

(LR-7) Write a brief narrative of a paragraph or two. Summarize your findings and be sure to mention any aspect of the linear model project (topic, data, scatterplot, line, r, or estimate, etc.) that you found particularly important or interesting.

You may submit all of your project in one document or a combination of documents, which may consist of word processing documents or spreadsheets or scanned handwritten work, provided it is clearly labeled where each task can be found. Be sure to include your name. Projects are graded on the basis of completeness, correctness, ease in locating all of the checklist items, and strength of the narrative portions

In: Advanced Math

Problem:      Construct and interpret a 90%, 95%, and 99% confidence interval for the mean heights...

Problem:      Construct and interpret a 90%, 95%, and 99% confidence interval for the mean heights of either adult females or the average height of adult males living in America. Do not mix genders in your sample as this will skew your results. Gather a random sample of size 30 of heights from your friends, family, church members, strangers, etc. by asking each individual in your sample his or her height. From your raw data convert individual heights to inches. Record your raw data and your conversions in the table on page 2 of this document. Construct and interpret the confidence interval based on the raw data from your random sample. In a word processed document, answer the reflections questions below. Use the equation editor to show your calculations for the percent difference indicated in 6) below.

Reflections: 1)            Summarize the characteristics of your sample – how many was in it, who was in it, from where did you get your sample, what would you estimate to be the average age of your sample, etc.?

2) What is x for your sample?

3) What is s for your sample?

3) State and interpret the 90% confidence interval for your sample.

4) State and interpret the 95% confidence interval for your sample.

5) State and interpret the 99% confidence interval for your sample.

6) Research from a credible source the average height in the population as a whole for the group you sampled. Make sure to credit your source. Calculate a percent difference between the average of your sample and the average in the population as a whole.   What was the percent difference of the average height in your sample and the population as a whole? Comment on your percent difference.

Table of Raw Data of womens heights

Sample Number

Height in Feet and Inches

Height Converted to Inches

1

5 feet

60

2

5 feet 3 inches

63

3

5 feet 5 inches

65

4

5 feet 5 inches

65

5

5 feet 9 inches

69

6

5 feet 11 inches

71

7

5 feet 1 inch

61

8

5 feet 2 inches

62

9

5 feet 3 inches

63

10

5 feet 6 inches

66

11

6 feet

72

12

5 feet 11 inches

71

13

5 feet 4 inches

64

14

5 feet 8 inches

68

15

5 feet 8 inches

68

16

5 feet 4 inches

64

17

5 feet 7 inches

67

18

5 feet 5 inches

65

19

5 feet 5 inches

65

20

5 feet 2 inches

62

21

5 feet 5 inches

65

22

5 feet 9 inches

69

23

5 feet 2 inches

62

24

5 feet 3 inches

63

25

5 feet 1 inches

61

26

5 feet 4 inches

64

27

5 feet 5 inches

65

28

5 feet 5 inches

65

29

5 feet 3 inches

63

30

5 feet 6 inches66

66

In: Statistics and Probability

Preparation of Individual Budgets During the first calendar quarter of 2019, Clinton Corporation is planning to...

Preparation of Individual Budgets

During the first calendar quarter of 2019, Clinton Corporation is planning to manufacture a new product and introduce it in two regions. Market research indicates that sales will be 6,000 units in the urban region at a unit price of $53 and 5,000 units in the rural region at $48 each. Because the sales manager expects the product to catch on, he has asked for production sufficient to generate a 4,000-unit ending inventory. The production manager has furnished the following estimates related to manufacturing costs and operating expenses:

Variable

Fixed

(per unit)

(total)

Manufacturing costs:
Direct materials
A (4 lb. @ $3.15/lb.) $12.60 -
B (2 lb. @ $4.65/lb.) 9.30 -
Direct labor (0.5 hours per unit) 7.50 -
Manufacturing overhead:
Depreciation - $7,650
Factory supplies 0.90 4,500
Supervisory salaries - 28,800
Other 0.75 22,950
Operating expenses:
Selling:
Advertising - 22,500
Sales salaries& commissions* 1.50 15,000
Other* 0.90 3,000
Administrative:
Office salaries - 2,700
Supplies 0.15 1,050
Other 0.08 1,950

*Varies per unit sold, not per unit produced.

a. Assuming that the desired ending inventories of materials A and B are 4,000 and 6,000 pounds, respectively, and that work-in-process inventories are immaterial, prepare budgets for the calendar quarter in which the new product will be introduced for each of the following operating factors:

Do not use negative signs with any of your answers below.

1. Total sales

($Answer)

2. Production

(Answer units)

3. Material purchase cost

Material A Material B
Total pounds (lbs.) required for production - -
Desired ending materials inventory - -
Total pounds to be available - -
Beginning materials inventory - -
Total material to be purchased (lbs.) - -
Total material purchases ($) - -

4. Direct labor costs

($Answer)

5. Manufacturing overhead costs

Fixed Variable Total
Depreciation - - -
Factory supplies - - -
Supervisory salaries - - -
Other - - -
Total manufacturing overhead -

6. Selling and administrative expenses

Fixed Variable Total
Selling expenses:
Advertising -    -    -
Sales salaries and commissions - - -
Other - - -
Total selling expenses -
Administrative expenses:
Office salaries - - -
Supplies - - -
Other - - -
Total administrative expenses -
Total selling and administrative expenses -


b. Using data generated in requirement (a), prepare a budgeted income statement for the calendar quarter. Assume an overall effective income tax rate of 30%.

Round answers to the nearest whole number.
Do not use negative signs with your answers.

Clinton Corporation
Budgeted Income Statement
For the Quarter Ended March 31, 2019
Sales -
Cost of Goods Sold: -   
Beginning Inventory - Finished Goods -
Material: -
Beginning Inventory - Material -
Material Purchases -
Material Available -
Ending Inventory - Material -
Direct Material -
Direct Labor -
Manufacturing Overhead -
Total Manufacturing Cost -
Cost of Goods Available for Sale -
Ending Inventory - Finished Goods -
Cost of Goods Sold -
Gross Profit -
Operating Expenses:   
Selling Expenses -
Administrative Expenses   -
Total Operating Expenses   -
Income before Income Taxes -
Income Tax Expense -
Net Income -

the spots with a(    - ) in the boxes (not including the ones in the top box with the numbers). or the word Answer (question 1,2,4) is what I need help figuring out can you plans include how you got the answers like the steps to get the answers so I can know how to solve future problems

In: Accounting

Nordstrom Inc. is a Seattle-based department store rivaling the likes of Saks Fifth Avenue, Neiman Marcus,...

Nordstrom Inc. is a Seattle-based department store rivaling the likes of Saks Fifth Avenue, Neiman Marcus, and Bloomingdale’s. Nordstrom is a Hall of Fame member of Fortune magazine’s “100 Best Companies to Work For” list. Nordstrom is known for its quality apparel, upscale environment, and generous employee rewards. However, what Nordstrom is most famous for is its delivery of customer service above and beyond the norms of the retail industry. This service orientation serves as a form of control as it helps employees decide how to behave when they encounter new situations. Stories about Nordstrom service abound. For example, according to one story the company confirms from long ago, in 1975 Nordstrom moved into a new location that had formerly been a tire store. A customer brought a set of tires into the store to return them. Without a word about the mix-up, the tires were accepted, and the customer was fully refunded the purchase price. In a different story, a customer tried on several pairs of shoes but failed to find the right combination of size and color. As she was about to leave, the clerk called other Nordstrom stores but could only locate the right pair at Macy’s, a nearby competitor. The clerk had Macy’s ship the shoes to the customer’s home at Nordstrom’s expense. In a third story, a customer describes wandering into a Portland, Oregon, Nordstrom looking for an Armani tuxedo for his daughter’s wedding. The sales associate took his measurements just in case one was found. The next day, the customer got a phone call, informing him that the tux was available. When pressed, the associate revealed that using her connections she found one in New York, had it put on a truck destined to Chicago, and dispatched someone to meet the truck in Chicago at a rest stop. The next day she shipped the tux to the customer’s address, and the customer found that the tux had already been altered for his measurements and was ready to wear. What is even more impressive about this story is that Nordstrom does not sell Armani tuxedos.

How does Nordstrom persist in creating these stories that serve as a way to control and direct employee behavior? If you guessed that they have a large number of rules and regulations designed to emphasize quality in customer service, you’d be wrong. In fact, the company gives employees a 5½-inch by 7½-inch card as the employee handbook. On one side of the card, the company welcomes employees to Nordstrom and states that their number one goal is to provide outstanding customer service, and for this they have only one rule. On the other side of the card, the single rule is stated: “Use good judgment in all situations.” By leaving it in the hands of Nordstrom associates, the company seems to have empowered employees who deliver customer service heroics every day.

1. The controlling facet of the P-O-L-C framework introduces you to a variety of controls. What types of controls does Nordstrom seem to effectively incorporate into their operations?

2. Does Nordstrom use behavioral controls? What are some examples?

3. Does Nordstrom use outcome controls? What are some examples?

4. What suggestions would you give Nordstrom for maintaining and evolving the organizational culture that has contributed to its success?

5. What balanced scorecard elements does Nordstrom seem to view as most important?

In: Finance

Bamboo Consulting is a consulting firm owned and operated by Lisa Gooch. The following end-of-period spreadsheet...

Bamboo Consulting is a consulting firm owned and operated by Lisa Gooch. The following end-of-period spreadsheet was prepared for the year ended July 31, 2019:

Bamboo Consulting
End-of-Period Spreadsheet
For the Year Ended July 31, 2019
Unadjusted Trial Balance Adjustments Adjusted Trial Balance
Account Title Dr. Cr. Dr. Cr. Dr. Cr.
Cash 57,100 57,100
Accounts Receivable 108,200 108,200
Supplies 12,200 (a) 6,300 5,900
Office Equipment 518,000 518,000
Accumulated Depreciation 28,500 (b) 6,900 35,400
Accounts Payable 21,100 21,100
Salaries Payable (c) 2,300 2,300
Lisa Gooch, Capital 521,800 521,800
Lisa Gooch, Drawing 25,000 25,000
Fees Earned 347,400 347,400
Salary Expense 186,600 (c) 2,300 188,900
Supplies Expense (a) 6,300 6,300
Depreciation Expense (b) 6,900 6,900
Miscellaneous Expense 11,700 11,700
918,800 918,800 15,500 15,500 928,000 928,000

Based on the preceding spreadsheet, prepare an income statement, statement of owner’s equity, and balance sheet for Bamboo Consulting. Be sure to read the instructions for each financial statement carefully.

CHART OF ACCOUNTSBamboo ConsultingGeneral Ledger

ASSETS
11 Cash
12 Accounts Receivable
13 Supplies
14 Office Equipment
15 Accumulated Depreciation
LIABILITIES
21 Accounts Payable
22 Salaries Payable
EQUITY
31 Lisa Gooch, Capital
32 Lisa Gooch, Drawing
33 Income Summary
REVENUE
41 Fees Earned
EXPENSES
51 Salary Expense
52 Supplies Expense
53 Depreciation Expense
54 Miscellaneous Expense
Labels
Current assets
Current liabilities
Expenses
For the Year Ended July 31, 2019
July 31, 2019
Property, plant, and equipment
Revenues
Amount Descriptions
Decrease in owner’s equity
Increase in owner’s equity
Lisa Gooch, Capital
Lisa Gooch, Capital, August 1, 2018
Lisa Gooch, Capital, July 31, 2019
Net income
Net loss
Total assets
Total current assets
Total expenses
Total liabilities
Total liabilities and owner’s equity
Total property, plant, and equipment
Total revenues
Withdrawals

Prepare an income statement for the year ended July 31, 2019 for Bamboo Consulting. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other than account names. You will not need to enter colons (:) on the income statement.

Prepare a statement of owner’s equity for the year ended July 31, 2019 for Bamboo Consulting. No additional investments were made during the year. For those boxes in which you must enter subtractive or negative numbers use a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items.

Prepare a balance sheet as of July 31, 2019 for Bamboo Consulting. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other than account names. You will not need to enter colons (:) or the word "Less" on the balance sheet; they will automatically insert where necessary.

In: Accounting

Who are the illegal miners in South Africa? They are often illegal immigrants, largely from Zimbabwe,...

Who are the illegal miners in South Africa? They are often illegal immigrants, largely from Zimbabwe, Mozambique, Lesotho or other central and southern African nations that come to South Africa in search of striking it rich, or at the very least, making a decent living. In South Africa, the illegal miners are often referred to as the Zama Zamas, a term that means “trying your luck”. These immigrants come to South Africa to earn a living with the hopes of remitting earnings back to their families in their respective homelands.Some illegal miners are South Africans who view illegal mining as a dangerous, albeit potentially remunerative activity. Some of the South African illegal miners can be described as “legal miners by day, yet illegal by night.” In other words, they might be gainfully employed by a mining firm and work legitimately for the company during the day shift, but re-enter the mine when evening falls to bolster their income. These individuals are particularly useful to a group of illegal miners given their familiarity with the mine and its risks. It is also quite possible that the South African illegal miners are unemployed mineworkers that were previously laid off by the mining companies when they were forced to retrench as a result of increasing global competitive pressures. Alternatively, illegal mineworkers may simply be young, black South Africans (without any previous mining experience) seeking a living in a nation that has struggled to reach its potential in the post-apartheid era and where one out of four South Africans is unemployed.Regardless of the nationality or the motivations that landed the illegal miners in this role, one thing is certain: it is not an easy life. Illegal miners may break into the very mines they work in by day, or often work in abandoned or disused mine shafts. (Disused mine shafts are mines that legitimate mining companies are in the process of closing down because they are no longer economically viable, but where the firms are awaiting final permits issued by the government to “officially” close the mine. Mining companies complain that all too frequently, the government-issued permit is delayed for months, thus exacerbating the illegal mining problem.) The miners often align themselves with a group of miners united in their illegal search of striking it rich. There is power in numbers. Being part of a group offers protection from rival factions of illegal mine workers, and fosters some level of camaraderie as the freelance miners ‘watch over’ one another. Since illegal miners are typically not employees of any business, nor members of any union and often times, not even citizens of South Africa, it can be said, that if it wasn’t for these informal groups, the miners would have no one else with even an ounce of their interests in mind. The groups generally work for a leader (a “kingpin”) who organizes runners to bring food and drinks to them, while the “miners” stay underground, some times for days – and even months - at a time. Illegal miners often run the risk of falling prey to other serious crimes. Illegal miners’ lives have been threatened - and lost - when they have refused to relinquish the deftly collected gold particles in their possession to thieves. Deaths, however, often go unreported, and as a result, there is no way of knowing how many illegal miners lose their lives each year. Only when there is a more visible event – such as a fire that went out of control in an abandoned mineshaft in 2009, killing 76 people, is a light shed on the plight and the working conditions of these workers.

**Word limit 2000-3000 words**

In: Economics

This assignment features an exponential function that is closely related to Moore’s Law, which states that...

This assignment features an exponential function that is closely related to Moore’s Law, which states that the numbers of transistors per square inch in Central Processing Unit (CPU) chips will double every 2 years. This law was named after Dr. Gordon Moore.

Table 1 below shows selected CPUs from this leading processor company introduced between the years 1982 and 2008 in relation to their corresponding processor speeds of Million Instructions per Second (MIPS).

Table 1: Selected CPUs with corresponding speed ratings in MIPS.

Processor Year t Years After 1982 When Introduced Million Instructions per Second (MIPS)

4 1982 0 1.28

5 1985 3 2.15

6 1989 7 8.7

7 1992 10 25.6

8 1994 12 188

9 1996 14 541

10 1999 17 2,064

11 2003 21 9,726

12 2006 24 27,079

13 2008 26 59,455

(Instructions per second, n.d.) This information can be mathematically modeled by the exponential function:

MIPS(t) = (0.112)(1.405^(1.14t+9.12))

NOTE: This function is created as a “best fit” function for a table of empirical data and, therefore, does not exactly match many (or any) of the data values in the table above. Rather, the total cumulative differences from all of the data points is at a minimum for this function.

Be sure to show your work details for all calculations and explain in detail how the answers were determined for critical thinking questions. Round all value answers to three decimals.

Generate a graph of this function, MIPS(t) = (0.112)(1.405^(1.14t+9.12)), t years after 1982, using Excel or another graphing utility. (There are free downloadable programs like Graph 4.4.2 or Mathematics 4.0; or, there are also online utilities such as this site and many others.) Insert the graph into your Word document that contains all of your work details and answers. Be sure to label and number the axes appropriately. (Note: Some graphing utilities require that the independent variable must be “x” instead of “t”.)

Find the derivative of MIPS(t) with respect to t. Show your work details.

Choose a t-value between 10 and 26. Calculate the value of MIPS'(t). Show your work details.

Interpret the meaning of the derivative value that you just calculated from part 3 in terms of the MIPS(t) function and this scenario.

If the MIPS(t) function is reasonably accurate, for what value of t will the rate of increase in MIPS per year reach 6,000,000 MIPS? Approximately which year does that correspond to? Show your work details.

For the t-value you chose in part 3 above, find the equation of the tangent line to the graph of MIPS(t) at that value of t. What information about the MIPS(t) function can be obtained from the tangent line? Show your work details.

Using Web or Library resources research to find the years of introduction and the processor speeds for both the CPU A and the CPU B. Be sure to cite your creditable resources for these answers. Convert the years introduced to correct values of t by subtracting 1982 from each year. Then, determine how well the MIPS(t) function predicts the forecast CPUs’ processor speeds by comparing the calculated values with the actual MIPS ratings of these two CPUs. Show your work details.

In: Statistics and Probability

Redstone Clayworks, Inc. is located in Sedona, Arizona and manufactures clay fire pits for patios. They...

Redstone Clayworks, Inc. is located in Sedona, Arizona and manufactures clay fire pits for patios. They are one of about two dozen firms around the world that manufacture and sell clay fire pits for retailers such as Home Depot, Lowe’s, Front Gate, and other upscale home product chains. There is virtually no product differentiation. A clay fire pit is a clay fire pit.

Assume that the world market demand and supply curves for clay fire pots intersects at $300 per unit.

The spreadsheet below gives some of Redstone’s production cost data. A template for the spreadsheet is provided in the Course Materials.

Q   

  TC   

  TFC   

  TVC

0

         6,000

       6,000

             -  

100

       12,000

       6,000

      6,000

200

       15,000

       6,000

      9,000

300

       21,000

       6,000

    15,000

400

       33,000

       6,000

    27,000

500

       48,000

       6,000

    42,000

600

       65,000

       6,000

    59,000

700

       83,000

       6,000

    77,000

800

     102,000

       6,000

    96,000

900

     123,000

       6,000

117,000

1000

     158,000

       6,000

152,000

Add columns to show, respectively, average fixed cost (AFC), average variable cost (AVC), average total cost (ATC), and short-run marginal cost (SMC). Then, add columns to show, respectively, total revenue (TR), marginal revenue (MR), total profit, average profit, and profit margin.


Place your completed spreadsheet in the Drop Box,and use it to answer questions 1-7. Your spreadsheet and calculations are worth 15 points and count as 500 words toward your word count requirement.

Your spreadsheet must include formulas showing how you arrived at the calculations. As an alternative, you may also submit a document showing your step-by-step calculations for each of the cells. You will not receive credit if you do not show your work using one of these two methods.

For Questions 2, 4, and 5, be sure to employ both of the General Rules for Implementing the Output Decision in your explanations.

A detailed explanation should be given for each question.

1. If Redstone wishes to maximize profit margin, how many units should it produce?   

2. What level of output should the manager of Redstone choose to produce? Explain your choice in at least 100 words.

3. Are your output choices the same in questions 1 and 2? Why or why not? Explain using at least 100 words.

4. Make a copy of your spreadsheet and double the fixed costs. How does this change your answer to question 2? Explain in detail.

5. Make another copy of your spreadsheet and suppose that fire pits fall out of fashion causing prices fall worldwide to $85. How many units should the manager choose to produce? Explain.

6. Should the firm shut down in the short-run? Explain in detail why or why not.

7. Should the firm shut down in the long run? Explain in detail why or why not.

8. Airline industry experts generally believe that because of the "highly competitive" nature of U.S. airline markets, it is usually impossible to pass on higher jet fuel prices to passengers by raising ticket prices.


What factors do you suppose contribute to making U.S. airline markets "highly competitive"?


Accepting the premise that U.S. airline markets are indeed highly competitive, analyze in both the short run and long run the difficulty of raising ticket prices when jet fuel prices rise.

In: Economics

Thurston Howell IV is the sole heir to the Howell Enterprise fortune. He does not participate...

Thurston Howell IV is the sole heir to the Howell Enterprise fortune. He does not participate in the business, preferring to tend to his comic book collection. He does however own a large piece of the company.

Recently he had become concerned about how the company has performed specifically related to some transactions relating to stockholders’ equity.

Here is the data relating to stockholders’ equity:

Howell Enterprises

Stockholders’ Equity

As of December 31, 2019

Common Stock, 2,000,000 shares outstanding                         10,000,000

Retained Earnings                                                                          7,500,000

Total Stockholders Equity                                                              17,500,000

Thurston currently owns 300,000 shares of Howell Enterprises

Here are the relevant transactions for 2020:

  1. The company issued 500,000 shares @ $8.00 per share
  2. The company purchased 100,000 shares @ $15 per share
  3. The company declared a $2.50 per share cash dividend
  4. The company declared a 2:1 stock split

Required

  1. Calculate the book value per share as of December 31, 2019. (total equity / number of shares outstanding)
  2. Calculate the total value of Thurston Howell IV’s stock as of December 31, 2019. (his shares x book value per share)
  3. Calculate the percentage of the company that Mr. Howell owns as of December 31, 2019. (his shares / total number of shares outstanding)
  4. Prepare journal entries for the transactions listed above
  5. Calculate the ending balances in the equity accounts
  6. Calculate the book value per share after the transactions have been recorded
  7. Calculate the total value of Thurston Howell IV’s stock after the transactions have been recorded. (his shares x new book value per share)
  8. Calculate the percentage of the company that Mr. Howell owns after the transactions have been recorded. (his shares x new total outstanding shares).
  9. Calculate the amount of loss that Mr. Howell has suffered (if any) as a result of the above transactions. (compare #2 to # 7).
  10. Write a summary in Word explaining your results. Which transactions caused Mr. Howell to lose money?

Record the transactions for 2020 and calculate the ending balances in all of the stockholders equity accounts.

Trans

Accounts

Debit

Credit

Ending Balances

Common Stock

Retained Earnings

Treasury Stock

Total Equity

# of Shares Outstanding

Book Value Per Share

Mr. Howell’s Investment

Before Transactions

After Transactions

Book Value Per Share

Total Value of Stock

% of Company Owned

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Bonds Problem

Hartz Corporation had the following transactions relating to borrowings during 2020:

  • Hartz issued $2,000,000 in ten-year 5% bonds when the price was 98 (Bond A). Interest is paid once a year.
  • Hartz issued $2,000,000 in ten-year 5% bonds when the price was 102. (Bond B). Interest is paid once a year.
  • Hartz issued $2,000,000 in ten -year 5% bonds that were issued at par (100) (Bond C). Interest is paid once a year

Required

  • Calculate the amount of money received when the bonds were issued for each bond.
  • Calculate the amount of cash paid on the interest date for each bond.
  • Calculate the amount of interest expense for each bond.

Bond A

Bond B

Bond C

Proceeds From Issuing Bond

Cash Paid on Interest Date

Interest Expense on Interest Date

In: Accounting