CP4-2 Analyzing and Recording Adjusting Journal Entries [LO 4-1, LO 4-2]

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Solvency and Profitability Trend Analysis

Addai Company has provided the following comparative information:

You have been asked to evaluate the historical performance of the company over the last five years.

Selected industry ratios have remained relatively steady at the following levels for the last five years:

Required:

1. Determine the following for the years 20Y4 through 20Y8. Round to one decimal place:

a. Return on total assets:

b. Return on stockholders’ equity:

c. Times interest earned:

d. Ratio of liabilities to stockholders' equity:

Tripple F-Health Club offers tennis,swimming and othr physical fitness facilities to its members.there are four of these clubs in the metropolitan area. each club has between 1,700 and 2,500 members. Revenue is derived from annual membership fees and hourly court fees. the annual membership fees are as follows:

Individual------ $ 45 , Student ----------- $ 30, Family ------- $ 100

The hourluy court fees vary from $8 to $12 depending upon the season and the time of day (prime versus non-prime time).

The peak raquetball season is considered to run from September through April. During this period court usage averages 90 to 100 percent of capacity during prime time (5:00 - 9:00 P.M.) and 50 to 60 percent of capacity during the remaining hours. Daily court usage during the off-season (i.e. , summer) averages only 20 to 40 percent of capacity.

Most of Tripple-F's memberships have September expirations. A substantial amount of the cash receipts are collected during the early part of the raquetball season due to the renewal of the annual membership fees and heavy court usage.However, cash receipts are not as large in the spring and drop significantly in the summer months.

Tripple-F is considering changing its membership and fee structure in an attempt to change its cash receipts. Under the new membership plan, only an annual membership fee would be charged, rather than a membership fee plus hourly court fees.There would be two classes of membership:

Individual ------- $300; FAmily ------ $50

The annual fee would be collected in advance at the time the membership application is completed. members would be allowed to use the raquetball courts as often as they wish during the year under the new plan.

All future memberships would be sold under these new terms. Current memberships would be honored on the old basis until they expire. However, a special promotional campaign would be instituted to attract new members and to encourage current members to convert to new membership plan immediately;

The annual fees for individual and family memberships would be reduced to $250 and $450, respectively, during the two-month promotional campaign. In addition, all memberships sold or renewed during this period would be for 15 months rather than the normal one-year period. Current members also would be given a credit toward the annual fee for the unexpired portion of their membership fee, and for all prepaid hourly court fees for league play which have not yet been used.

Triple-F's management estimates that 60 to 70 percent of the present membership would continue with the club. The most active members ( 45 percent of the present membership) would convert immediately to the new plan, while remaining members who continue would wait until their current memberships expire. Those members who would not continue are not considered active (i.e. they play five or fewer times during the year). Management estimates that the loss of members would be offset fully by new members within six months of instituting the new plan. Furthermore, many of the new members would be individuals who would play during non-prime time. Management estimates that adequate court time will be available for all members under the new plan.

If the new membership plan is adopted, it would be instituted on February 1st, well before the summer season. The special promotional campaign would be conducted during March and April. Once the plan is implemented, annual renewal of memberships and payment of fees would take place as each individual or family membership expires.

Required : Your consulting firm has been hired to help Triple-F Health club evaluate its new fee structure. Write a letter tothe club's president answering the following questions:

1. Will Triple-F Health Club's new membership plan and fee structure improve its ability to plan its cash receipts ? Explain your answer.

2. Triple-F Health Club should evaluate the new membership plan and fee structure completely before it decides to adopt or reject it.

a. Identify the key factors that Triple-F should consider in its evaluation.

b. Explain what type of financial analyses Triple-F should prepare in order to make a complete evaluation.

3. Explain how triple-F Health Club's cash management would differ from the present if the new membership plan and fee structure were adopted.

( Please could you explain in details all the answer and inform me as soon as it's ready .I really need it urgently , preferably within an hour . I'm living in Belgium and the Hour difference is +9 hours i.e. We are 9 hours ahead of the PST.) My email for notification sujoanghoshatgooglemailcom and my mobile phone number 0032 472056439.

On average, how would you think the typical person in the following socio-economic groups would view an income redistribution scheme, and WHY?

A single mother-of-color with two teenage children
An unmarried computer engineer in San Francisco earning $100,000 per year
An immigrant from abroad who has worked himself up form nothing to riches by starting a successful real estate company
A democratic congresswoman from the inner city
A republican senator from a rural state
A 31-year-old foreign exchange trader in an international bank earning $7,000,000 in commissions annually. (This actually occurs!)***
A homeless person in San Francisco
Yourself

The Quick Pass CPA Review Co., charges $10,000 for its review classes, and offers a money-back guarantee, if the student does not pass on the first try. The company collected $500,000 from students in its first class, which was held from July through October of 2019. Since the grades of the students on the November test will not be known until January 2020, the owner of Quick Pass intends to not recognize any income until the number of students who actually passed is known, so that he can report income and refund in the same year. What is your advice to your client?

The amount of time part time worker at a pet store is normally distributed with a mean of 25 hours and a standard deviation of 2.5 hours. In a random sample of 25 employees, what is the probability that a worker will work for between 24 and 26 hours?

A student goes to the university library. The probability that the student checks out the science book for the science class is 0.40; the probability that the student checks out the math book is 0.30; and the probability that the student checks out both the science and math book is 0.20. What is the probability that the student checks out the science and the math book?

Dutch elm disease of American elm trees is caused by a fungus. It is known that 95% of elm trees in a city that have been treated with a fungicide recover from the disease. What is the probability that in a random sample of 4 elm trees in this city, at least 3 trees recover when treated with the fungicide?

A canning company claims that the amount of sugar in a cup of cherries is 13.2 grams. The population is normally distributed with a population standard deviation known to be 0.5 grams. The researcher took a sample of 25 cups of cherries and found a mean of 12.95 grams of sugar. Test at the 5% significance level that the amount of sugar in a cup of cherries is different than what the company claims. What is the p value for this test and what is your conclusion?

Trust Us Communications Pty Ltd, is a national communications company which has recently placed an advertisement in the newspaper of a number of large cities in Australia. This is the advertisement:

(Unlimited Broadband Internet Access

For $99.99 a month get unlimited broadband access anywhere in Australia.

Call 1800 999 999 to take up this offer.
Hurry. Limited time only.)

Jenny lives in a remote part of New South Wales and runs an internet dating/introduction business. She is excited by the advertisement and decides to take up the offer.

Jenny later discovers that the advertisement did not explain all of the terms and conditions of the offer very clearly. It seems that the offer is not for ‘unlimited broadband access’. Once a user has reached a usage limit of 150 GB in a calendar month, they are prevented from gaining further internet access until the following calendar month. It also appears that access is not available ‘anywhere in Australia’ and is primarily restricted to areas within 200km of a capital city. Jenny needs permanent access to the internet to conduct her business and will be severely affected by these conditions.

Jenny is very disappointed, she feels that she has been deceived by the advertisement. Advise Jenny of the chances of her success in mounting a claim under the ACL against Trust Us Communications Pty Ltd.

Oraby Company imports goods from different countries. Some transactions are denominated in U.S. dollars and others in foreign currencies. A summary of accounts receivable and accounts payable on December 31, 2008, before adjustments for the effects of changes in exchange rates during 2008, follows:

Accounts receivable:

In US dollars                                    $100 000

In 60 000 Swiss francs (SFr)            $50 000

Accounts payable:
In US dollars                                    $86 000

In 10 000 000 Yen                           $ 97 000

The spot rates on December 31, 2008, were:
1 SFr = $0.85

1 Yen = $0.0095

The average exchange rates during the collection and payment period in 2009 are:
1 SFr = $0.9

1 Yen = $0.0098
  
Required:

1) Prepare the adjusting entries on December 31, 2008.
2) Record the collection of the accounts receivable and the payment of the accounts payable in 2009.
3) What was the foreign currency gain or loss on the accounts receivable transaction denominated in SFr for the year ended December 31, 2008? For the year ended December 31, 2009? Overall for this transaction?
4) What was the foreign currency gain or loss on the accounts payable transaction denominated in Yen? For the year ended December 31, 2008? For the year ended December 31, 2009? Overall for this transaction?

One of the basic elements of Roger's diffusion theory is the concept of adoption process which deals with the mental stages through which an individual passes from the time of his or her first knowledge of an innovation to the time of product adoption or purchase. Briefly describe these stages giving examples of Apples' iPhone.

Question : Provide reflections on job costing system of costing system in managerial accounting unit.

Reflections on your overall research experience from the individual assignment (e.g. looking for
journal articles, reading and reviewing the literature etc.) What was enjoyable, what was difficult,
and any challenges you experienced?