It appears that George is running a profitable business. George is aware you are in an MBA Managerial Finance class and comes to you for advice on his working capital practices. More specifically George asks you to do the following:

View the following video: http://searchcenter.intelecomonline.net/playClipDirect.aspx?id=4870EEC7664070BB9D6744FDA7325EE44F45E0E47862343D60FAA8E3325D1A83C46D5C6FAB3D01A758FA30144214BB3D

Describe his working capital practices, including his methods of capital budgeting analysis techniques.

Analyze the potential pitfalls in his capital budgeting practices that George should be aware of.

Develop a simple statement of cash flows for George’s Trains using any information gleaned from the video. What areas of improvement do you recommend and why?

On January 1, 20x1, Entity acquires 30% of Co. B, for P600,000. Co. B reports profit of P200,000 and also declares
dividends of P50,000 in 20x1. How much is the carrying amount of the investment in associate, Dec 31, 20x1?
a)   P600,000   c)   P645,000
b)   P660,000   d)   P630,000

58   A Company acquired a 30% interest in B Company, for P400,000 on January 1, 2020. During the year, B Company
earned profits of P80,000 and paid no dividends. IN the year 2021, B Company incurred losses of P32,000 and
paid dividends of P10,000. In A Company's consolidated financial statements, at the end of 2021, what would
be the carrying amount of its interest in B Company, according to IAS 28, Investments in Associates ?
       a)   P438,000   c)   P414,400
       b)   P411,400   d)   P400,000

Conceptual Framework/ Accounting Overview/ Standards/Financial Statements…
59   Which of the following is one of the fundamental qualitative characteristics?
       a)   Faithful representation   c)   Reliability
       b)   Comparability   d)   Relevant

60   A concept that states that all the components of a complete set financial statement are interrelated.
       a)   Concept of Entity   c)   Accounting Process Concept
       b)   Concept of Articulation   d) Concept of Fair Presentation

PAS 29 - Financial Reporting in Hyperinflationary economies
61   Under constant peso accounting…
       a)   all items in the statement of profit or loss and other comprehensive income are restated.
       b)   some items in the statement of profit or loss and other comprehensive income are restated.
       c)   items in the statement of profit or loss and other comprehensive income are not restated.
       d)   items in the statement of profit or loss are restated but not in other comprehensive income

The gain or loss on net monetary position is computed as,
a)   the difference between the "net monetary items, end - historical" and "net monetary items, end - restated'.
   This amount is recognized in profit or loss.
b)   the difference between the "net monetary items, end - historical" and "net monetary items, end - restated'.
   This amount is recognized in equity.
c)   the difference between the "net monetary items, beg. - historical" and "net monetary items, end - restated'.
   This amount is recognized in profit or loss.
d)   the difference between the "net monetary items, beg. - historical" and "net monetary items, end - restated'.
   This amount is recognized in equity.

The balance of the PPE account for SLOAT, Inc. was $270,500 and $346,000 at the beginning and end (respectively) of 2021. On May 10 the company issued for cash a 6.4%, $20,000 Note Payable that paid simple interest on an annual basis. SLOAT made a debt for equity swap on Dec 31, 2021 (the company’s fye). The no-par common stock account was $500,000 and $720,000, and during the year SLOAT acquired a building by issuing common stock. During the year SLOAT sold 70% depreciated equipment for $22,000, which resulted in a $3,850 gain. The company paid all income taxes in full. The Notes / Payable account balance at Jan 1 and Dec 31 was $190,000 and $126,000 (respectively). On SLOAT’S balance sheet PPE (net) was $175,500 at the end of 2020 and $207,000 at the end of 2021. What was the depreciation expense for 2021? [4 points]

NI was $ 238,800 and AR, INV and AP each increased by $36,200 during the year. What was Cash Flow from Operations? [4 points]

Assuming that cash at the beginning of the year was $36,200, based upon the information provided above what was the ending balance of cash? [2 points]

In recent years, Crane Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below.

For the declining-balance method, Crane Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 32,000. Actual hours of use in the first 3 years were: 2021, 810; 2022, 6,400; and 2023, 7,900.

(a)

Compute the amount of accumulated depreciation on each machine at December 31, 2023.

On February 1, 2018, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $50 million. The bonds mature on January 31, 2022 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $50,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

Required:
1. Determine the price of the bonds issued on February 1, 2018.
2-a. Prepare amortization schedules that indicate Cromley’s effective interest expense for each interest period during the term to maturity.
2-b. Prepare amortization schedules that indicate Barnwell’s effective interest revenue for each interest period during the term to maturity.
3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell’s investment on February 1, 2018.
4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2020.

Problem 2-03A a-d (Video)

Tom Zopf owns and manages a computer repair service, which had the following trial balance on December 31, 2019 (the end of its fiscal year).

Summarized transactions for January 2020 were as follows.

Post the journal entries to the accounts in the ledger. (Post entries in the order of journal entries presented in the previous part.)

Problem 20-17 Integrating problem; error; depreciation; deferred taxes [LO20-6]

George Young Industries (GYI) acquired industrial robots at the beginning of 2015 and added them to the company’s assembly process. During 2018, management became aware that the $2.2 million cost of the machinery was inadvertently recorded as repair expense on GYI’s books and on its income tax return. The industrial robots have 10-year useful lives and no material salvage value. This class of equipment is depreciated by the straight-line method for financial reporting purposes and for tax purposes it is considered to be MACRS 7-year property. Cost deducted over 7 years by the modified accelerated recovery system as follows:

The tax rate is 40% for all years involved.

Required:
1. & 3. Prepare any journal entry necessary as a direct result of the error described and the adjusting entry for 2018 depreciation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
  

Q4. You are 20 years old and have completed your BBA and want to pursue further education but you don’t want to take money from your father. Your plan is to start working and earn enough money so that you can finance your degree on your own and get yourself enrolled in five years’ time. You estimate that the annual cost of doing an MBA 5 years from today will be PKR 400,000 and the program will be two years long. You will need the money at the beginning your program so that you are not worried about how to clear your dues during your studies. Luckily you go for a job interview and they hire you and you start working at a salary of PKR 25,000. So you decide that 50% you will deposit in a saving account at a 10% rate with monthly compounding for your further studies and the remaining amount you will use for your daily expenses.

1. Will you be able to meet your goal at this current saving rate? [2 marks]
2. What percentage of your salary should you save if you want to have exactly your university expenses amount? [2 marks]
3. How would your answer to part 1 change if the saving account rate changed to 5%? Comment on your answer. [2 marks]
4. If you are given an option to invest at the 10% saving rate with monthly compounding or 10.5% semiannual compounding, which would you chose? Explain your answer. [4 marks]

Salary is monthly and MBA cost is for one year as annual cost means one year cost

At January 1, 2020, Splish Company’s outstanding shares included the following.

259,000 shares of $50 par value, 7% cumulative preferred stock

974,000 shares of $1 par value common stock

Net income for 2020 was $2,570,000. No cash dividends were declared or paid during 2020. On February 15, 2021, however, all preferred dividends in arrears were paid, together with a 5% stock dividend on common shares. There were no dividends in arrears prior to 2020.

On April 1, 2020, 454,000 shares of common stock were sold for $10 per share, and on October 1, 2020, 112,000 shares of common stock were purchased for $21 per share and held as treasury stock.

Compute earnings per share for 2020. Assume that financial statements for 2020 were issued in March 2021. (Round answer to 2 decimal places, e.g. $2.55.)

Earnings per share $