Questions
On February 1, 2018, Cromley Motor Products issued 6% bonds, dated February 1, with a face...

On February 1, 2018, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $55 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 $55,000 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) (Use appropriate factor(s) from the tables provided.)

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.

In: Accounting

On February 1, 2018, Cromley Motor Products issued 9% bonds, dated February 1, with a face...

On February 1, 2018, Cromley Motor Products issued 9% bonds, dated February 1, with a face amount of $60 million. The bonds mature on January 31, 2022 (4 years). The market yield for bonds of similar risk and maturity was 10%. Interest is paid semi-annually on July 31 and January 31. Barnwell Industries acquired $60,000 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 41, PVA of $1, FVAD of $1, PVAD of $1) (Use appropriate factor(s) from tables provided.) Required: 1. Determine the price of the bonds issued 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.

In: Accounting

Spike purchased on 6/15/2020 and placed in service on 9/1/2020 a new warehouse for $5,000,000. (a)...

Spike purchased on 6/15/2020 and placed in service on 9/1/2020 a new warehouse for $5,000,000.

(a) Determine the cost recovery deduction for 2020.​​

(b) Spike sold the warehouse on March 22, 2028. Determine the cost recovery deduction for 2028.

In: Accounting

Imagine that you work at a local department store in a midlevel management position. You learn...

Imagine that you work at a local department store in a midlevel management position. You learn that your company is being acquired by Big Box, a much larger, non-union retailer. The sale and purchase of your store is intended to bring more product, logistical efficiency, and employee efficiencies to your particular market. Describe three significant HR issues that you and your people will likely face after your company is acquired.

In: Operations Management

Can you analyze Amazon . You must write in third person and with the client in...

Can you analyze Amazon

. You must write in third person and with the client in mind.

• Brief Company Overview:

Company and Name Location

Brief History and Years in Business o Business Model

Key Markets, Activities and Product Lines o Key Senior Executives (Founder/CEO)

Vision, Mission, and Corporate Values

Stated Company Objectives

Size (Revenue, Profit, # Of Employees, Number Of Facilities

• Resources:

Tangible Resources

Intangible Resources

• Capabilities

• Core Competencies

• Business Model and Value Chain

• Strategic Intent

• Long-Term Objectives

• Current Strategies

• Internal Assessment

3 Years Sales History

3 Year Costs-Profit Margin History

Profitability Ratios

Liquidity Rations

Leverage Rations

In: Finance

The United Arab Emirates (UAE) was established in 1971 and is a country located in the...

The United Arab Emirates (UAE) was established in 1971 and is a country located in the Middle East. The country is often called “the Emirates” or simply “UAE”. UAE borders the Gulf of Oman and the Persian Gulf. Neighboring countries include Oman and Saudi Arabia, and UAE also shares sea borders with Qatar, Iran, and Pakistan. Strategically, UAE is in important location along the southern approaches to The Strait of Hormuz, a transit point for the world’s crude oil. UAE is also in the top 10 countries for the largest oil reserves in the world.
The geography of UAE includes lots of rolling sand dunes of desert and also mountains in the eastern part of the country. The government consists of a federation with specified powers delegated to the UAE federal government and other powers reserved to the member emirates (equivalent to principalities). The chief of state is the president and the head of government is the prime minister. UAE has an open-market economy in which the prices of products and services are set using a free price system.
The foundation for this market economy lies in the collaboration between the seven emirates that are part of the UAE. They include the emirates of Abu Dhabi. Ajman, Dubai. Fujairah, Ras al- Khaimah, Sharjah. and Umm al-Quwain. Each emirate is governed by a hereditary emir. similar to succession planning in countries with royalty (king or queen) as the head of state. These emirs jointly make up the Federal Supreme Council, which serves as the highest legislative and executive body in the UAE. One of the seven emirs is selected as the president of the United Arab Emirates. The capital of the country is Abu Dhabi. Islam is the official religion, and Arabic is the official language. Most people have heard of Abu Dhabi and Dubai because they are the country's centers of commercial and cultural activities. Dubai is UAE's most populous city, with more than 2 million people, and it has emerged as a true global city with an eclectic cultural makeup. It also has a strategic location as a business gateway for the Middle East and Africa for multinational en- terprises from all of the world's continents.
Dubai has frequently been rated as one of the best places to live in the Middle East (although it is also one of the most expensive). The emirate of Dubai has been ruled by the Al Maktoum family since 183: the emirate is considered a constitutional monarchy. In 2013, the Norway-based Global Network for Rights and Development ranked UAE as the 14th country in its annual International Human Rights Indicator report. This was a first among Arab countries, with the next Arab country on the list, Tunisia, at a distant 72nd place. Only about 10 percent of the population in Dubai are Arabs, with the remaining 90 percent being expatriates. Most of the expatriates are from Asia, with India (50 percent) and Pakistan (16 percent) prominently featured. The largest group of Westerners is from the United Kingdom.
With this eclectic cultural background, Dubai's bid to host the World Expo 2020 with a theme of "connecting minds, creating the future" makes sense both logically and strategically. The theme resonates well with issues related to culture. In essence, the theme illustrates and acknowledges differences in culture, and the theme supports the notion that we strive to emphasize similarities
across the globe. Today, multinational enterprises have to evaluate their core uniqueness and how they can leverage this strategic uniqueness in the global marketplace. The leveraging of the uniqueness typically requires a focus on similarities across cultures instead of differences. Connecting minds is a great way to illustrate how people, companies, and countries can stress the importance of looking for similarities first and then focus on the similarities that outweigh the differences in creating strategic options.
As with any World Expo. the expectation is that the world will be treated to an important event in the year 2020 in Dubai. The Expo on "connecting minds, creating the future" will span six months, following World Expo 2015 in Milan. Italy. and World Expo 2017 in Astana, Kazakhstan. The expectation is also that countries will showcase who they are and what they can do in the spirit of today's era of "nation branding." Tracing history, the best-known first World Expo was held in the Crystal Palace in Hyde Park, London (United Kingdom), in 1851 under the title "Great Exhibition of the Works of Industry of All Nations." Since 1928, the Bureau International des Expositions (International Exhibitions Bureau) has served as an international sanctioning body for the World Expo. These Expo showcases have generally gone through three eras: the era of industrialization (18511938), the era of cultural exchange (1939-1987), and the era of nation branding (1988— present).
The theme for Dubai's World Expo 2020 is a direct connection to its cultural values and beliefs in facilitating connections and pioneering new ideas. The organizers expect 70 percent of the 25 million visitors to originate outside UAE, making it the most globally oriented World Expo in its long history. The idea is that the global community will come together and explore creative and pioneering solutions to three key drivers of global development: sustainability, mobility, and opportunity. As viewed by the World Expo 2020 organizing team, sustainability centers on lasting sources of energy and water. Mobility focuses on smart systems of logistics and transportation. And opportunity refers to new paths to economic development.
Questions to Answer
1. What forces shaped the culture in the country of UAE and Dubai in particular? How similar or different are these forces from those that shaped the culture of Western nations?
2. If you were in a position to advise a Western company that was considering doing business in UAE, for the first time, what would your advice be?
3. Using Dubai aa an example, do you believe that cultural similarities among people can outweigh cultural differences that exist in terms of doing business together in the future?

In: Economics

Exercise 20-04 The following facts apply to the pension plan of Sheridan Inc. for the year...

Exercise 20-04

The following facts apply to the pension plan of Sheridan Inc. for the year 2020. Plan assets, January 1, 2020 $528,000 Projected benefit obligation, January 1, 2020 528,000 Settlement rate 8 % Service cost 43,400 Contributions (funding) 26,600 Actual and expected return on plan assets 51,600 Benefits paid to retirees 35,600 Using the preceding data, compute pension expense for the year 2020.

As part of your solution, prepare a pension worksheet that shows the journal entry for pension expense for 2020 and the year-end balances in the related pension accounts. (Enter all amounts as positive.)

In: Accounting

Spritz Company owns 15% of the stock of Turner Corporation. The investment was purchased for $200,000....

Spritz Company owns 15% of the stock of Turner Corporation. The investment was purchased for $200,000. At the beginning of 2020, it had a fair value of $230,000. At the end of 2020, its fair value is $250,000. Turner reported net income of $100,000 for 2020, and declared and paid cash dividends of $60,000. Spritz sells products to Turner at a markup of 20% on cost. Turner’s ending inventory for 2020 included a balance of $10,800 for products purchased from Spritz.

Required

Prepare the journal entries Spritz makes in 2020 to record the above facts, assuming that Spritz treats its investment as having significant influence and uses the equity method.

In: Accounting

The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given...

The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given below for Arduous Company. Additional information from Arduous’s accounting records is provided also.

ARDUOUS COMPANY
Comparative Balance Sheets
December 31, 2021 and 2020
($ in millions)
2021 2020
Assets
Cash $ 114 $ 86
Accounts receivable 195 204
Investment revenue receivable 12 9
Inventory 213 205
Prepaid insurance 10 18
Long-term investment 172 130
Land 207 155
Buildings and equipment 424 410
Less: Accumulated depreciation (99 ) (130 )
Patent 33 37
$ 1,281 $ 1,124
Liabilities
Accounts payable $ 55 $ 75
Salaries payable 12 21
Interest payable (bonds) 14 9
Income tax payable 17 19
Deferred tax liability 21 13
Notes payable 26 0
Lease liability 87 0
Bonds payable 220 285
Less: Discount on bonds (27 ) (30 )
Shareholders’ Equity
Common stock 445 415
Paid-in capital—excess of par 105 90
Preferred stock 80 0
Retained earnings 240 227
Less: Treasury stock (14 ) 0
$ 1,281 $ 1,124
ARDUOUS COMPANY
Income Statement For Year Ended
December 31, 2021
($ in millions)
Revenues and gain:
Sales revenue $ 460
Investment revenue 16
Gain on sale of treasury bills 3 $ 479
Expenses and loss:
Cost of goods sold 185
Salaries expense 78
Depreciation expense 9
Amortization expense 4
Insurance expense 12
Interest expense 33
Loss on sale of equipment 28
Income tax expense 41 390
Net income $ 89


Additional information from the accounting records:

  1. Investment revenue includes Arduous Company’s $12 million share of the net income of Demur Company, an equity method investee.
  2. Treasury bills were sold during 2021 at a gain of $3 million. Arduous Company classifies its investments in Treasury bills as cash equivalents.
  3. Equipment originally costing $80 million that was one-half depreciated was rendered unusable by a flood. Most major components of the equipment were unharmed and were sold for $12 million.
  4. Temporary differences between pretax accounting income and taxable income caused the deferred tax liability to increase by $8 million.
  5. The preferred stock of Tory Corporation was purchased for $30 million as a long-term investment.
  6. Land costing $52 million was acquired by issuing $26 million cash and a 10%, four-year, $26 million note payable to the seller.
  7. The right to use a building was acquired with a 15-year lease agreement; present value of lease payments, $94 million. Annual lease payments of $7 million are paid at the beginning of each year starting January 1, 2021.
  8. $65 million of bonds were retired at maturity.
  9. In February, Arduous issued a stock dividend (6.0 million shares). The market price of the $5 par value common stock was $7.50 per share at that time.
  10. In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $14 million.


Required:
Prepare the statement of cash flows for Arduous Company using the indirect method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

In: Accounting

he comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given...

he comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given below for Arduous Company. Additional information from Arduous’s accounting records is provided also.

ARDUOUS COMPANY
Comparative Balance Sheets
December 31, 2021 and 2020
($ in millions)
2021 2020
Assets
Cash $ 124 $ 91
Accounts receivable 200 214
Investment revenue receivable 15 14
Inventory 216 210
Prepaid insurance 13 22
Long-term investment 185 135
Land 216 160
Buildings and equipment 428 420
Less: Accumulated depreciation (109 ) (140 )
Patent 44 45
$ 1,332 $ 1,171
Liabilities
Accounts payable $ 60 $ 85
Salaries payable 15 30
Interest payable (bonds) 17 14
Income tax payable 22 28
Deferred tax liability 31 18
Notes payable 28 0
Lease liability 92 0
Bonds payable 225 295
Less: Discount on bonds (32 ) (39 )
Shareholders’ Equity
Common stock 460 420
Paid-in capital—excess of par 115 95
Preferred stock 85 0
Retained earnings 233 225
Less: Treasury stock (19 ) 0
$ 1,332 $ 1,171
ARDUOUS COMPANY
Income Statement For Year Ended
December 31, 2021
($ in millions)
Revenues and gain:
Sales revenue $ 494
Investment revenue 20
Gain on sale of treasury bills 1 $ 515
Expenses and loss:
Cost of goods sold 190
Salaries expense 83
Depreciation expense 14
Amortization expense 1
Insurance expense 17
Interest expense 38
Loss on sale of equipment 25
Income tax expense 46 414
Net income $ 101


Additional information from the accounting records:

  1. Investment revenue includes Arduous Company’s $15 million share of the net income of Demur Company, an equity method investee.
  2. Treasury bills were sold during 2021 at a gain of $1 million. Arduous Company classifies its investments in Treasury bills as cash equivalents.
  3. Equipment originally costing $90 million that was one-half depreciated was rendered unusable by a flood. Most major components of the equipment were unharmed and were sold for $20 million.
  4. Temporary differences between pretax accounting income and taxable income caused the deferred tax liability to increase by $13 million.
  5. The preferred stock of Tory Corporation was purchased for $35 million as a long-term investment.
  6. Land costing $56 million was acquired by issuing $28 million cash and a 10%, four-year, $28 million note payable to the seller.
  7. The right to use a building was acquired with a 15-year lease agreement; present value of lease payments, $98 million. Annual lease payments of $6 million are paid at the beginning of each year starting January 1, 2021.
  8. $70 million of bonds were retired at maturity.
  9. In February, Arduous issued a stock dividend (8.0 million shares). The market price of the $5 par value common stock was $7.50 per share at that time.
  10. In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $19 million.


Required:
Prepare the statement of cash flows for Arduous Company using the indirect method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

In: Accounting