On January 1, 2018, Byner Company purchased a used tractor. Byner paid $3,000 down and signed a noninterest-bearing note requiring $44,000 to be paid on December 31, 2020. The fair value of the tractor is not determinable. An interest rate of 11% properly reflects the time value of money for this type of loan agreement. The company’s fiscal year-end is 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. Prepare the journal entry to record the acquisition of the tractor.
2. How much interest expense will the company include in its 2018 and 2019 income statements for this note?
3. What is the amount of the liability the company will report in its 2018 and 2019 balance sheets for this note?
  

: You are the HR Director for a company that employs self-managed work teams who operate assembly lines to produce televisions. Due to a wave of interpersonal problems in your workplace, the top brass have asked you to find a way to hire only individuals who can work well in teams (they expect to screen 5000 applicants during the next hiring cycle). You contacted some of the local consulting companies and found five companies who have each created a test that they say will predict which of your job applicants would work best in teams. A summary of their brochures is provided below.

For each of the five companies/tests, your first task is to evaluate their test and describe the “pros and cons” of each as a potential hiring solution (given the information they provide). Think about each with regard to cost, reliability, validity, and generalizability (see your textbook and the class PowerPoint notes).  

Employment Services, Inc. ($10 / applicant). ESI originally created this test to be used to predict teamwork behaviors of lawyers working on cases together. They found that scores on their test (which had an internal consistency reliability of .81) correlated with supervisor ratings of teamwork (r = .26).

The Jones Group ($6 / applicant). The Jones group is a France-based consulting company that has recently opened an office in the U.S. They’ve been using a test to predict teamwork behaviors of factory workers in French companies. The test, which has a test-retest reliability of .92, has been found to be correlated with supervisor ratings of teamwork behaviors (r = -.62).

Teamwork Unlimited ($8 / applicant). TU recently constructed this test and used it to select individuals to work in self-managed work teams at a factory that manufactures televisions (not yours). Their brochure features a testimonial from the CEO of that company, who said: “before I used the Teamwork Unlimited Teamwork Test ™, we had fights among our employees all the time. Since we’ve been using the TUTT to screen out those who aren’t team players, we haven’t had a single altercation among our employees.”

Smith Business Solutions ($8 / applicant). SBS originally designed their study to predict the teamwork behaviors of auto workers in Detroit, but have begun to market their test to other industries. In their sample of auto workers, they found that their teamwork test correlated with supervisor ratings of job performance (r = .45), and it had a coefficient alpha of .57.

Miller Consulting Company ($7 / applicant). MCC is owned by Bob Miller, one of the leading I-O psychologists who specialize in teams. Miller recently wrote a paper outlining his theory of Teamwork Skills, which has generated a lot of interest among both academics and consultants. MCC created a test for teamwork skills, using the types of characteristics that Miller’s theory predicted would be associated with teamwork behaviors. MCC administered the test to a sample of administrative assistants and found the test-retest reliability to be .71.

Oriole Company declared dividends of $19700 in fiscal 2021 and paid the $41000 dividends that were declared in fiscal 2020. Oriole paid the 2021 dividends in early fiscal 2022. Which of the following journal entries would NOT be recorded in fiscal 2021?

Sally was hired at an annual salary of $60,000 on 1/1/20.   She elected to contribute $2000 to her Flexible Spending Account (FSA) and her employer contributed $500 to the plan. She contributed $5,000 to the company’s 401(k) plan and the company contributed $2500.   In addition, she contributed $100 from her payroll to the local United Way campaign. Compute the amount of her 2020 compensation that is subject to FICA taxes and the amount subject to income taxes.

INTRODUCTION TO FINANCIAL INSTRUMENTS AND MARKETS

Valuation multiples are often used to compare companies quickly. Identify an appropriate valuation multiple/ratio and evaluate if the company (Woolworths) is over or under valued using relative valuation. What are the reasons you picked the multiples that you did and how did you conclude that Woolworths is over or under valued? .

Current Price AU$36.01

Fair Value AU$36.01

Share price 31 march 2020 AU$35.10

Several years ago, Timmons Company issued bonds with a face value of $1,000,000. It redeemed half of the bonds at 99 on January 1, 2020. At that time, the total unamortized premium on the bond issue was $30,000.

a) What is the reacquisition price of the bonds redeemed?

b) What is the carrying value of the bonds redeemed?

c) What is the gain or loss on redemption?

d) Prepare the entry to record the redemption of the bonds.

e) What effect will the redemption have on the income statement for the year?

U.S. Steel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel round bars that is expected to cost $15 million now and another $10 million 1 year from now. If total operating costs will be $1.5 million per year starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company make annually in years 1 through 8 to recover its investment plus a return of 16% per year?

The company must make $______ million annually in years 1 through 8 to recover its investment plus a return of 16% per year.

U.S. Steel is considering a plant expansion to produce austenitic, precipitation hardened, duplex, and martensitic stainless steel round bars that is expected to cost $13 million now and another $10 million 1 year from now. If total operating costs will be $1.5 million per year starting 1 year from now, and the estimated salvage value of the plant is virtually zero, how much must the company make annually in years 1 through 10 to recover its investment plus a return of 21% per year?

The company must make $____ million annually in years 1 through 10 to recover its investment plus a return of 21% per year.

(Foreign Currency Transaction)

On 10/17/2017, a U.S. company (which has a 12/31 year-end) took delivery from a Canadian firm of inventory costing C$500,000. Payment is due in 90 days. Concurrently the company entered into a forward contract to buy C$500,000 in 90 days at 1 C$ = $1.05. Direct exchange rates for C$ on the respective dates are as follows:

Required: Prepare all entries related to this transaction, assuming that the payment was made on 1/15/18.