Rexon Company leases equipment to Ten-Care Company beginning January 1, 2016. The lease terms, provisions, and related events are as follows:

1. What is the easiest asset to convert into cash and explain why?

2. Revenue generating assets can also be linked to debt. What is the maximum a company can be financed at?

As an auditor, a common task is to verify that expenditures of a company are properly classified as capital or revenue expenditures. Discuss the determinants of such classifications. If an expenditure is capitalized, is such expenditure ever expensed? If so, how?

1.      In country Water, there are only 2 goods: Wave and Fish. The following table shows the prices and quantities produced of these goods in 2005, 2010, and 2015:

i)      Calculate NGDP, RGDP, GDP Deflator for all the three years.

ii)    Calculate cost of basket, CPI for the same years

iii)  Calculate inflation for year 2015 from 2010 using both GDP deflator and CPI. Does the answer vary between the two methods? Explain why or why not   

2. A) What are the main differences between financial market and financial intermediary? Why would you choose to diversify your bonds and stocks when you have the alternative option of buying stocks/ bonds of a big amount from a single organization?

B) What happens in the labor market when companies follow Minimum Wage Law? Explain with a graph. Remember to explain the supply, demand of available labor in the market and the ongoing minimum wage of the market

Background information In this lab, you will test the hypothesis that the evolution of skull shape within the human lineage took place largely by changing the timing of events in development from a chimpanzee-like ancestor. The change in shape during development (that is, allometry) is a source of heritable variation that can lead to adaptive evolution. In this lab, we’re focusing on how morphology (the shape of an organism) changes through time instead of focusing on how genes change through time. However, these two biological disciplines are united in the study of evolutionary development, or “evo-devo” for short (Carroll 2005). Growth from fertilized egg (zygote) to adult involves a host of complex interactions among genes, molecules, and tissues. Subtle alterations in the timing of gene expression, especially for regulatory genes, can have far-reaching consequences that result in different adult morphology (Carroll 2005).

1. Read the of the above information, and then paraphrase the primary hypothesis you will test in this lab. Next, represent this hypothesis as a schematic (concept map), by drawing what you think the ancestral skull looked like and how the shape of the skull evolved in descendent species.

A cell phone company offers a simple extended warranty plan. If your phone is damaged, they will repair it for up to $50. If you lose or destroy your phone, they will give you a $200 voucher towards a new phone. The company believes that 5% of customers will need the replacement voucher and 10% will request a repair. 1. If the company charges $25 for this extended warranty, what is the expected value of the profit they will earn? 2. What is the standard deviation of their profit? 3. Suppose the company collects 10 warranty plans on one day. What is the mean of the company's total profit? 4. What is the standard deviation of the 10 total warranty plans? What assumption does this calculation require? Do you think this assumption is reasonable? 5. What are the mean and standard deviation for the profit on a 1000 plans? 6. What do your answers to the previous question tell you about the company's likelihood of making a profit? 7. Is the $25 warranty a wise purchase for you? Given that you will probably buy dozens of devices over the next decade, are these types of warranties a wise purchase for you?

ou have just begun work at XYZ Manufacturing Company. Among its benefits offerings is a generous qualified 401(k) plan with an employer match. In 2015, your annual salary is $45,000 and you are age 55. You’ve decided to contribute 10 percent of your annual salary to your 401(k) plan even though the Internal Revenue Service allows you to contribute up to $24,000 in 2015 ($18,000 plus a $6,000 catch up contribution for employees age 50 or more). The annual addition is $53,000.

   1   How much more money would you need to contribute to meet the allowable maximum contribution?

   2   In 2015, the company offers a $0.75 match for each dollar that you contribute between 3 percent and 6 percent of your annual salary. How much is the company match based on your 10 percent contribution?

   3   Based on the sum of your answers to questions 9-9 and 9-10, what is the difference between the IRS maximum annual addition for 2015 and the total contribution to your 401(k) plan?

1. Which of the following are examples of adjusting entries?

i) An entry to record interest owing on a bank loan at the end of the period. The interest is not yet paid, and is previously unrecorded.
ii) A depreciation entry to reflect the use of long-lived equipment during the period.
iii) An entry to correct an error that was discovered in the trial balance, when a $100 debit was incorrectly posted to inventory rather than accounts receivable.

a. i & ii

b. i & iii

c. ii & iii

d. i, ii, & iii

2. A company sold merchandise for cash. What is the effect of this sale?

a. increase in Revenue, increase in COGS, decrease in Inventory

b. increase in Revenue, decrease in COGS, increase in Inventory

c. increase in Revenue, increase in COGS, increase in Inventory

d. increase in Revenue, decrease in COGS, decrease in Inventory

Suppose a company has fixed costs of $5,500 and variable costs per unit of  7/8x + 1,040 dollars, where x is the total number of units produced. Suppose further that the selling price of its product is 1,200 − 1/8 x dollars per unit.

(a)

Form the cost function and revenue function (in dollars).

C(x)

=

R(x)

=

Find the break-even points.

x =

50,110

(b)

Find the vertex of the revenue function.

(x, y) =

Identify the maximum revenue.

$

(c)

Form the profit function from the cost and revenue functions (in dollars).

P(x) =

Find the vertex of the profit function.

(x, y) =

Identify the maximum profit.

$

(d)

What price will maximize the profit? (Round your answer to the nearest cent.)

Medical research has shown that repeated wrist extension beyond 20 degrees increases the risk of wrist and hand injuries. Each of 24 students at a university used a proposed new computer mouse design. While using the mouse, each student's wrist extension was recorded. Data consistent with summary values given in a paper are given. Use these data to test the hypothesis that the mean wrist extension for people using this new mouse design is greater than 20 degrees. (Use α = 0.05. Use a statistical computer package to calculate the P-value. Round your test statistic to two decimal places and your P-value to three decimal places.)

26 28 25 24 26 27 27 25 25 25 27 28

22 27 25 28 26 24 31 27 28 26 26 27

t = ____________

P-value =_____________