Imagine that you are preparing taxes for a local tax service provider. A married couple named Judy and Walter Townson have come to you to seeking assistance with their federal income taxes. During your meeting with the Townsons, you gather the following information:

• They are both 55 years of age.
• They have two daughters and one son. One daughter (age 25) is married with children. One daughter (age 20) is living at home and attending college. Their son (age 16) is a junior in high school.
• They are currently paying for their college-student daughter to attend school full time.
• Judy is employed as a teacher and makes $60,000 a year. She used $500 of her personal funds to purchase books and other supplies for her classroom.
• Walter is employed as a CPA and makes $100,000 a year.
• They provided you a 1099-INT which reported $4,500 in interest, of which $500 was savings bond interest.
• They provided you a 1099-DIV which reported $300 in dividends.
• They received a state tax refund last year of $385.
• They provided you a list of expenses including:
  • Doctor’s bills, $800
  • Prescriptions, $400
  • New glasses, $2,000
  • Dental bills, $560
  • Braces, $5,000
  • Property taxes for their two cars of $800, which included $50 in decal fees
  • Real estate taxes of $4,500
  • Mortgage interest of $12,000
  • Gifts to charities, $1,000
  • GoFundMe contribution to local family in need, $100
  • Tax preparation fees for last year’s taxes, $400

Consider the most beneficial way for Judy and Walter to file their federal income tax return. Prepare a brief written summary that addresses the following:

1. Estimated taxable income for Judy and Walter (please show computations).
2. Summary of tax return, including any suggestions or tax planning considerations.
3. Explain how you determined the filing status, dependents, and use of standard/itemized deduction.

Motor-Dexterity Test Motor-dexterity tests are often used in psychological studies, especially in neuropsychology. For this task, we are going to test motor-dexterity while looking for signs of frustration. First, take a clean pair of rolled-up socks or some other soft item. Then, have the participants throw it into a hoop you make with your arms. The objective is not to see how well they do the task but to see which hand they use; you are trying to determine dominance. After doing this task, ask the participants which hand they prefer to use when writing. While most will prefer the right, some will prefer the left. If a person says both, ask that individual to write a sentence with both hands, one at a time and the two of you can decide which hand to call dominant. In most cases, people will report they use the right hand more, and they will also unintentionally pick the right hand to throw the object with. If they report left and use the right hand to throw, then record that as mixed, but select the hand they choose as dominant. In the end, you will go with what the participant decides. You are required to record all information on the data sheet. This study involved ten participants. The researcher timed how fast each person put fifteen toothpicks into a mug with each hand. To reduce a significant difference being caused by practice effects, five of the participants started with their dominant hand (DH) and the next set of five started with their nondominant hand (NDH). While they were doing the task, the researcher rated the level of frustration while performing with one hand and then the other one. The researcher was careful not to allow experimenter bias to influence what he or she recorded. Here is the scale used to rate frustration: Very Frustrated Not Very Frustrated 5 4 3 2 1 Look at the data sheet: Participant # Start with NDH (seconds) FL-NDH DH (seconds) FL-DH 1 Right 7 3 6 1 2 Right 10 4 8 2 3 Right 9 3 8 2 4 Left 6 2 7 3 5 Right 8 4 6 1 6 Left 12 5 9 1 7 Left 8 1 7 1 8 Right 11 3 10 2 9 Left 8 2 8 2 10 Left 13 5 9 3 The hypotheses for the study were: People will perform the motor-dexterity task faster with their DH as compared to their NDH. People will show more frustration while using the NDH. Determine the average time with the motor-dexterity test, along with the standard deviation, and then use Minitab to analyze the data with a paired t-test to see if there is a significant performance difference between the two hands. Run another paired t-test to see if there is a difference in frustration (FL) while using the DH versus the NDH. Obtain the results and decide if the hypotheses are supported. Write a summary of the findings. Submit the results and summary of the findings in a 3- to 4-page Microsoft Word document.

Consider the experimental results for the following randomized block design. Make the calculations necessary to set up the analysis of variance table.

Use α = 0.05 to test for any significant differences.

Find the value of the test statistic. (Round your answer to two decimal places.)

Find the p-value. (Round your answer to three decimal places.)

p-value =

Consider the experimental results for the following randomized block design. Make the calculations necessary to set up the analysis of variance table.

Use α = 0.05 to test for any significant differences.

Find the value of the test statistic. (Round your answer to two decimal places.)

__________.

Find the p-value. (Round your answer to three decimal places.)

p-value = ________.

Using these results, complete the table below and then use your results to answer the questions that follow. (Please remember to round all answers to two decimal places: 0.00 at each step.) (23 points)

7. Complete the table below by calculating the relative performance ranges and then converting them to absolute performance.

Relative Performance Ranges

Really worse

worse

Typical

Better

Really better

Converted to Absolute Performance

8. What is your interpretation of the performance of your class on this assessment? (4 points)

MT scores: 11, 11, 16, 17, 19, 20, 21, 21 23 24 24 26 26 27 27 28 28 28 29 30 31 31 32 33 35 37 38 38 39 42 44

Questions for Class MT Score Distribution Analysis

1. Create a histogram of MT scores.

2. Describe the shape of the MT scores distribution.

3. Compute the mean and standard deviation.

4. Compute the 5-number summary.

5. Create a boxplot of MT scores.

6. Compute the probability that a randomly selected student from the class scored higher than 20.

7. Are the MT scores normally distributed? Why or why not?

8. Assuming a normal fit, compute the percentile of your score.

9. Compute your actual percentile from the raw data.

10. Do your computations for #8 and 9 support your answer to #7? Why or why not?

Consider the following two scenarios for the economy and the expected returns in each scenario for the market portfolio, an aggressive stock A, and a defensive stock D.

Required:
a. Find the beta of each stock.
b. If each scenario is equally likely, find the expected rate of return on the market portfolio and on each stock.
c. If the T-bill rate is 3%, what does the CAPM say about the fair expected rate of return on the two stocks?
d. Which stock seems to be a better buy on the basis of your answers to (a) through (c)?

A fund manager has a portfolio worth $50 million with a beta of 0.75. The manager is concerned about the performance of the market over the next two months and plans to use three-month futures contracts on a well-diversified index to hedge its risk. The current level of the index is 2,750, one contract is on 250 times the index, the risk-free rate is 6% per annum, and the dividend yield on the index is 2% per annum. a) What position should the fund manager take to eliminate all exposure to the market over the next two months? b) Calculate the effect of your strategy on the fund manager’s returns if the level of the market in two months is 2,700 and 2,800.

Pacific Packaging's ROE last year was only 3%; but its management has developed a new operating plan that calls for a debt-to-capital ratio of 60%, which will result in annual interest charges of $128,000. The firm has no plans to use preferred stock and total assets equal total invested capital. Management projects an EBIT of $364,000 on sales of $4,000,000, and it expects to have a total assets turnover ratio of 2.6. Under these conditions, the tax rate will be 40%. If the changes are made, what will be the company's return on equity? Do not round intermediate calculations. Round your answer to two decimal places.