Suppose Samantha dies this year with a gross estate of $15 million and no adjusted prior gifts. Calculate the amount of estate tax due (if any) under the following scenarios:

1. Samantha’s husband, Mark, is the sole beneficiary.
2. Mark receives $10 million from the estate and the remainder is donated to the American Red Cross.
3. Mark receives $10 million from the estate and their son, Luke, receives $5 million.
4. Mark receives $10 million and $5 million is placed in a trust. The trustee is required to pay income to Mark for her life and the remainder to their son, Luke.

Part B Submission Requirements:

• Submit with all calculations shown.

Western Industrial Products is considering a project with a five-year life and an initial cost of $110,000. The discount rate for the project is 13 percent. The firm expects to sell 2,400 units a year. The cash flow per unit is $25. The firm will have the option to abandon this project at the end of year three (after year three's sales) at which time the project's assets could be sold for an estimated $55,000. The firm should abandon the project at the end of year three if the expected level of annual sales, starting with year 4, falls to _____ units or less. Ignore taxes.

1,443 units

2,230 units

928 units

375 units

1,319 units

Aquamarine plans to manufacture two lines of chairs in the coming year – lounge and patio. The company is considering introducing an activity-based costing system. Given below are each activity, its cost and its related activity driver.

The level of activity for the year is:

Required

1. Under an activity-based costing system, what is the activity cost per unit of activity driver for assembly?

DataSpan, Inc., automated its plant at the start of the current year and installed a flexible manufacturing system. The company is also evaluating its suppliers and moving toward Lean Production. Many adjustment problems have been encountered, including problems relating to performance measurement. After much study, the company has decided to use the performance measures below, and it has gathered data relating to these measures for the first four months of operations.

Management has asked for your help in computing throughput time, delivery cycle time, and MCE. The following average times have been logged over the last four months:

Required:

1-a. Compute the throughput time for each month.

1-b. Compute the delivery cycle time for each month.

1-c. Compute the manufacturing cycle efficiency (MCE) for each month.

2. Evaluate the company’s performance over the last four months.

3-a. Refer to the move time, process time, and so forth, given for month 4. Assume that in month 5 the move time, process time, and so forth, are the same as in month 4, except that through the use of Lean Production the company is able to completely eliminate the queue time during production. Compute the new throughput time and MCE.

3-b. Refer to the move time, process time, and so forth, given for month 4. Assume in month 6 that the move time, process time, and so forth, are again the same as in month 4, except that the company is able to completely eliminate both the queue time during production and the inspection time. Compute the new throughput time and MCE.

Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $70 per unit, and variable expenses are $40 per unit. Fixed expenses are $540,000 per year. The present annual sales volume (at the $70 selling price) is 15,000 units.

Required:

1. What is the present yearly net operating income or loss?

2. What is the present break-even point in unit sales and in dollar sales?

3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit?

4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)?

The LaGrange Corporation had the following budgeted sales for the first half of the current year:

The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:

Collections on sales:

55% in month of sale

40% in month following sale

5% in second month following sale

The accounts receivable balance on January 1 of the current year was $82,000, of which $63,000 represents uncollected December sales and $19,000 represents uncollected November sales.

The total cash collected during January by LaGrange Corporation would be:

$190,000

$192,000

$140,000

$216,000

The LaGrange Corporation had the following budgeted sales for the first half of the current year:

The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:

Collections on sales:

55% in month of sale

40% in month following sale

5% in second month following sale

The accounts receivable balance on January 1 of the current year was $82,000, of which $63,000 represents uncollected December sales and $19,000 represents uncollected November sales.

The total cash collected during January by LaGrange Corporation would be:

$190,000

$192,000

$140,000

$216,000

Prepare a Statement of Cost of Goods Manufactured for Frank's Furniture for the year ending December 2019.

Advertising Expense - $ 22250
Depreciation expense – Office Equip - 10,440
Depreciation expense – Selling Equip - 12,125
Depreciation expense – Factory Equip. - 37,400
Direct Labor - 564,500
Factory supervision - 123,400
Factory supplies used (indirect materials) - 8,060
Factory utilities - 39,500
Inventories:  
Raw Materials, Dec 31, 2018 - 42,375
Raw Materials, Dec 31, 2019 - 72,430
Goods-in-Process, Dec 31, 2018 - 14,500
Goods-in-Process, Dec 31, 2019 - 16,100
Finished Goods, Dec 31, 2018 - 179,200
Finished Goods, Dec 31, 2019 - 143,750
Income taxes expense - 138,700
Indirect labor - 61,000
Misc. Production costs - 10,440
Office salaries expense - 72,875
Raw materials purchased - 896,375
Rent expense – office space - 25,625
Rent expense – selling space - 29,000
Rent expense – factory building - 95,500
Maintenance expense - factory - 32,375
Sales - 5,002,000

Sales Discounts - 59,375
Sales salaries expense - 297,300

Thank you!

FreddieMac reports that the average rate on a 30-year fixed rate mortgage is 3.92% as of January 2012. This is down from 4.76% in January 2011 and 5.03% in January 2010. If you have a $216,000, 5%, 30-year mortgage, how much interest will you save if you refinance your loan at 3.5% for 20 years?

Matt has a substantial portfolio of securities. As of December 2, of the current year, Matt has a net capital gain position of $22,000. Discuss Matt's optimal tax-planning strategy for capital gains and losses.

A list of accounts and their balances of O’Neill’s Psychological Services, at its year end July 31, 2021, is presented below:

Prepare balance sheet.