A student runs an experiment with two carts on a low-friction track. As measured in the Earth reference frame, cart 1 (m = 0.48 kg ) moves from left to right at 1.0 m/s as the student walks along next to it at the same velocity. Let the +x direction be to the right.

a) What velocity v⃗ E2,i in the Earth reference frame must cart 2 (m = 0.16 kg ) have before the collision if, in the student's reference frame, cart 2 comes to rest right after the collision and cart 1 travels from right to left at 0.33 m/s?

b) What does the student measure for the momentum of the two-cart system?

c) What does a person standing in the Earth reference frame measure for the momentum of each cart before the collision?

Using the income statement for the Sports Car Tire Company, compute the following ratios (show formula + calculations):

a. Interest coverage

b. The fixed charge coverage

The total assets for this company equal $40,000. Set up the formula for the DuPont system ratio analysis, and compare c,d and e.

c. Profit margin

d. Total asset turnover

e. Return on assets (investment)

The Sports Car Tire Company

Sales   $20,000
Less: Cost of goods sold   9,000
Gross profit   11,000
Less: Selling and administrative expense   4,000
Less: Lease expense   1,000
Operating profit*   6,000
Less: Interest expense   500
Earnings before taxes   5,500
Less: Taxes (40%)   2,200
Earnings after taxes   $3,300
*Equals income before interest and taxes.

Adjusted WACC. Thorpe and Company is currently an​ all-equity firm. It has three million shares selling for $40 per share. Its beta is 1.4​, and the current​ risk-free rate is 3.5​%. The expected return on the market for the coming year is 13.4​%. Thorpe will sell corporate bonds for $40,000,000 and retire common stock with the proceeds. The bonds are​ twenty-year semiannual bonds with a 8.6​% coupon rate and ​$1,000 par value. The bonds are currently selling for ​$1,135.64 per bond. When the bonds are​ sold, the beta of the company will increase to 1.9.

1. What was the WACC of Thorpe and Company before the bond​ sale?

2. What is the adjusted WACC of Thorpe and Company after the bond sale if the corporate tax rate is 20%​? Hint​: The weight of equity before selling the bond is​ 100%.

6) c programming Case study: In a certain building at a top secret research lab, some yttrium-90 has leaked into the computer analysts’ coffee room. The leak would currently expose personnel to 150 millirems of radiation a day. The half-life of the substance is about three days, that is, the radiation level is only half of what is was three days ago. The analysts want to know how long it will be before the radiation is sown to a safe level of 0.466 millirem a day. They would like a chart that displays the radiation level for every there days with message unsafe or sage after every line. The chart should stop just before the radiation level is on-tenth of the sage level, because the more cautious analysts will require a safety factor of 10.

Jordan Technologies, Inc. has three divisions. Jordan has a desired rate of return of 12.0 percent. The operating assets and income for each division are as follows:

Jordan headquarters has $129,000 of additional cash to invest in one of its divisions. The division managers have identified investment opportunities that are expected to yield the following ROIs:

1. . Calculate the residual income:

1. (1) At the corporate (headquarters) level before the additional investment.

2. (2) At the division level before the additional investment.

3. (3) At the investment level.

4. (4) At the division level after the additional investment.

In a certain building at a top secret research lab , some yttrium-90 has leaked into the computer analysts' coffee room. The leak would currently expose personnel to 150 millirems of radiation a day. The half-life of the substance is about three days; that is, the radiation level is only half of what it was three days ago. The analysts want to know how long it will be before the radiation is down to a safe level of 0.466 millirem a day. They would like a chart that displays the radiation level for every three days with the message Unsafe or Safe after every line. The chart should stop just before the radiation level is one-tenth of the safe level, because the more cautious analysts will require a safety factor of 10. The program should also print the first day that the room can be entered.

1. Fraud, Professional Ethics and Auditor Independence 

   a) When assessing a client’s integrity, the auditor will consider the client’s willingness to allow the auditor full access to information required to form an opinion and pay a fair amount for the work completed. Explain why.

   b) Mike is a very experienced auditor with unique expertise in the mining industry. As a result, Mike has been the lead audit partner for the audit at BKK Oil for the last seven years. Recently, Mike was approached by the board of BKK with an offer of employment as a director starting in two years’ time. The only condition was that the audit work (for the year ended 30 June 2020) must be finished in six weeks and the independent auditor’s report signed off before 15th August 2020, as the Annual General Meeting (AGM) has been scheduled for early September. Mike is aware that the audit of BKK normally takes at least nine weeks.

   i) Identify and explain TWO possible threats to audit independence.

   ii) Suggest appropriate actions and safeguards that could be put in place to reduce the threat to an acceptable level.

   c) Two months before the end of the financial year, Greenlight Resort terminated the contract of one of its senior sales managers. Her employment was terminated after it was discovered she had worked in collusion with several customers to commit fraud. This included giving special discounts on room rates and event services, and reducing customers’ period of stay and value of other services provided. The manager would then take direct payments from the customers. During the investigation process, it was discovered that the manager was the only one allowed to access the customer database and had authorisation to update prices. For more than two years, the manager had never taken any annual leave.

   i) Identify and explain TWO fraud risk factors.

   ii) Identify TWO key accounts that are potentially affected by the fraud. For each account, identify ONE key assertion that is at risk.

i) Authorisation by the shift supervisor of all overtime hours worked.

ii) Review of overtime payment records by the project manager.

Briefly explain the purpose of each of the above control procedures, and identify whether the procedure recommended is a ‘prevent’ or ‘detect’ control.

c) You are reviewing the test result in relation to accounts receivable at Ryan’s Tools as below:

i) Is the above test a test of controls or a substantive test of details? Explain your answer. What type of procedure did the auditor use?

ii) Determine the key assertion addressed by the test procedure. Suggest ONE alternative testing procedure that can be used to test the assertion identified.

iii) Explain why the conclusion reached is appropriate or inappropriate, and outline the key additional audit procedure that you believe needs to be performed.

If the nominal interest rate is 0.09 and the (expected) inflation rate is 0.03, what is the real interest rate? (Answer as a decimal.)

Consider an economy with only one good: corn. In 2010 the price of corn was 6.08 and in 2011 the price was 7.9. What was the inflation rate? (Answer as a decimal. Round to three decimal places.)

Let NGDP be 1,825 and the money supply be 474. What is velocity? (Round to one decimal place.)

If the nominal interest rate is 0.09 and the (expected) inflation rate is 0.03, what is the real interest rate? (Answer as a decimal.)

Consider an economy with only one good: corn. In 2010 the price of corn was 6.08 and in 2011 the price was 7.9. What was the inflation rate? (Answer as a decimal. Round to three decimal places.)

Let NGDP be 1,825 and the money supply be 474. What is velocity? (Round to one decimal place.)