Scenario

DoEpicStuff started as a 3 person start-up. Two of these three people wrote code. Each coder would create database tables as needed. There was no naming convention for the database tables or the fields of the table. There was no established process for checking whether the two tables had fields in common and in that case whether they had the same name or the same data type. The coders were free to add columns to (or even drop columns from) each others tables. This caused unexpected code failures.

DoEpicStuff managed to get funding from investors and added more staff very quickly. The new coders would write code that reference tables created by the earlier two employees. Their code often contained bugs because they assumed data that referred to a certain field would contain the same type of data in another field with the same name in a different table. They also acquired some new contracts which required handling sensitive information. The CEO instructed each employee as to what data in which tables they could access, but there was no mechanism for enforcing it.

DoEpicStuff acquired some valuable data repositories from another start-up, BellyUp, that had just gone bankrupt. Data from BellyUp was also referenced in some of the code. But there was no effort made to ascertain the data quality of this data. Indeed, the data collected by DoEpicStuff overlapped with some of the data from BellyUp but no effort was made to determine which of the over-lapping data was more current or which should be trusted. Individual coders decided on a ad-hoc basis whether to use data from BellyUp or from DoEpicStuff.

Some of the coders aggregated data manually from some of the tables and entered them into other tables. But after a while no one could remember where this aggregated data came from. Because of employee turnover it was unclear who had done which part of the aggregation.

The sales and marketing team of DoEpicStuff needed to prepare some marketing material and needed accurate statistics to be included in the marketing material. But they had no one to turn to find out which data was accurate and current.

1. Identify as many problems as possible with how DoEpicStuff manages its data assets, with a one or two sentence explanation of why you think each problem you have identified is a problem.
2. Provide a suggestion for a set of data governance policies that will fix the data management problems you have identified in Step 1. For each policy you recommend, clearly identify the problems it will fix and with a two or three sentence justification for why you think it will fix these problems.

Exercise 2

The following data represent the mutual fund prices reported at the end of the week for selected 42 nationally sold funds.

10        17        15        18        22        19        10        17        18        25        11        13        35        28

27        29        39        31        35        33        22        24        28        35        45        50        47        38

41        31        21        11        49        38        35        25        33        42        27        15        28        34

1. Organize the data.
2. Present the data.

Exercise 3

Twenty MBA students have got the following marks out of 100 in three courses in the first semester.

1. Organize the above data in meaningful form.
2. Present the data.
3. Analyze and compare performance of students in three courses.

Exercise 4

A random sample of 8 MBA students from two sections of same batch are selected from of a B-School. The marks scored by these students are given below;

On the basis of sample statistic find out (show working),

1. Which section is more consistent?                                                           
2. Which section’s overall performance is better and why?

Concur Technologies, Inc., is a large expense-management company located in Redmond, Washington.  The Wall Street Journal asked Concur to examine the data from 8.3 million expense reports to provide insights regarding business travel expenses. Their analysis of the data showed that New York was the most expensive city, with an average daily hotel room rate of $198 and an average amount spent on entertainment, including group meals and tickets for shows, sports, and other events, of $172. In comparison, the U.S. averages for these two categories were $89 for the room rate and $99 for entertainment. The table in the Excel Online file below shows the average daily hotel room rate and the amount spent on entertainment for a random sample of 9 of the 25 most visited U.S. cities (The Wall Street Journal, August 18, 2011). Construct a spreadsheet to answer the following questions.

1. Develop the least squares estimated regression equation.

   Entertainment = (___)+(___) Room Rate ( to 4 decimals)

2. Provide an interpretation for the slope of the estimated regression equation (to 3 decimals).

   The slope of the estimated regression line is approximately (____) . So, for every dollar increase in the hotel room rate the amount spent on entertainment increases by $ (___).

3. The average room rate in Chicago is $128, considerably higher than the U.S. average. Predict the entertainment expense per day for Chicago (to whole number).

   $ (___)
   
   

   Hotel Room Rate ($)	Entertainment ($)
   152	162
   96	104
   87	103
   113	141
   92	98
   103	121
   133	167
   88	140
   81	96

Case: ABC Corp. International Company, a manufacturer of medical device, assembles a particular product line at a wholly owned facility in Singapore. The product is designed at XYZ’s headquarters in the United States, but the different components used in the assembly process are manufactured throughout Asia and shipped to Singapore for final assembly. Some of the components are manufactured in multiple locations, so the customer can actually designate where ABC Corp. should source the components. The final product is assembled in Singapore and then shipped via FedEx Freight to customers in European Union and throughout Asia. ABC Corp. Singapore does not purchase any major components from the United States, but it invoices all of the components from Asian suppliers in U.S. dollars. Moreover, it sells the product to Asian customers in U.S. dollars. However, all of its major expenses in Singapore are paid in Singapore currency. Most of the key executive marketing decisions are made by the U.S. marketing headquarter staff, although the Singapore staff acts as a liaison with FedEx Freight personnel and deals with the local employees, most of whom come from the European Union on short-term work visas.

Part II: When it comes to translating the financial statements of entities in highly inflationary countries, which of the following approaches makes more sense and why? What are the implications of this for ABC Corporation?

1st option – Remeasure using the temporal method, even though the functional currency is the local currency for operation purposes.

2nd option – Restate for inflation and translate using the current rate method.

Case study 6.1

Accounting for brands

West Ltd is a leading company in the sale of frozen and canned fish produce. These products are sold under two brand names. Fish caught in southern Australian waters are sold under the brand ‘Artic Fresh’, which is the brand the company developed when it commenced operations and which is still used today. Fish caught in the northern oceans are sold under the brand name ‘Tropical Taste’, the brand developed by Fishy Tales Ltd. West Ltd acquired all the assets and liabilities of Fishy Tales Ltd a number of years ago when it took over that company’s operations.

West Ltd has always marketed itself as operating in an environmentally responsible manner, and is an advocate of sustainable fishing. The public regards it as a dolphin-friendly company as a result of its previous campaigns to ensure dolphins are not affected by tuna fishing. The marketing manager of West Ltd has noted the efforts of the ship, the Steve Irwin, to disrupt and hopefully stop the efforts of whalers in the southern oceans and the publicity that this has received. He has recommended to the board of directors that West Ltd strengthen its environmentally responsible image by guaranteeing to repair any damage caused to the Steve Irwin as a result of attempts to disrupt the whalers. He believes that this action will increase West Ltd’s environmental reputation, adding to the company’s goodwill. He has told the board that such a guarantee will have no effect on West Ltd’s reported profitability. He has explained that, if any damage to the Steve Irwin occurs, West Ltd can capitalise the resulting repair costs to the carrying amounts of its brands, as such costs will have been incurred basically for marketing purposes. Accordingly, as the company’s net asset position will increase, and there will be no effect on the statement of profit or loss and other comprehensive income, this will be a win–win situation for everyone.

Required

The chairman of the board knows that the marketing manager is very effective at selling ideas but knows very little about accounting. The chairman has, therefore, asked you to provide him with a report advising the board on how the proposal should be accounted for under accounting standards and how such a proposal would affect West Ltd’s financial statements.

1. Accounting for the guarantee:

• Is there a liability? Legal or constructive? What is the past event? What obligation exists?

• Should it be recognised?

• How is it to be measured?

• Contingent liability?

Expect that a provision/contingent liability would need to be raised in relation to the guarantee. Measurement issues may lead to the need for a contingent liability.

2. Can costs be capitalised into brands?

• Note one brand is internally generated and one is acquired. The internally generated brand “Antartic Fresh” will not be recognised while “Tropical Taste” was acquired in a business combination. Accounting for internally generated brands differs from that for brands acquired in a business combination – explain.

• Extra outlays on the brand cannot be capitalised into an already existing brand as the outlays are generally to maintain the existing asset rather than increase the asset. Also, hard to distinguish the expenditure from that spent to develop the business as a whole.

• AASB 138 says that brands cannot be revalued as no active market exists.

• Can the outlay be related to the brand or is it internally generated goodwill: does it relate to the entity as a whole rather than a single asset? Cannot recognise internally generated goodwill.

• Expected result is that any outlays would need to be expensed.

3. Effects on financial statements:

• Liability? Provision?

• Contingent liability – notes only.

• Asset? No.

• Profit: expense relating to the guarantee provision?

Please help me analyze

1. Project Evaluation --Cash Flows question:

Adams Video is considering whether to make an investment in a new type of technology. The following factors are considered in the initial discussion:i). The company has already spent $3 million researching the technology; ii). The new technology will affect the cash flows produced by the other operations of the company; iii). If the investment is not made, then the company will be able to sell one of its laboratories for $2 million.

a) Which of the above factors should the company consider when it decides whether to undertake the investment? [4 Marks]

b) Explain why for each of the factors. [6 Marks]

c) Explain why we must use incremental cash flows in project evaluation.

2. Firm Value with FCF and WACC:

a) Describe the FCF definition (in terms of its underlying object or asset) and its practical application; [8 Marks]

b) Discuss the special function of WACC.

3. Corporate Governance question:

a) Provide a simple definition of Corporate Governance (in traditional Corporate Finance terms) in your own words; [8 Marks]

b) Discuss the possible relation between CEO compensation and company performance in terms of corporate risk and average equity return.

4. Capital Structure Question:

a) Briefly define the terms: Business Risk and Financial risk; [8 Marks]

b) Describe how the business risk and financial risk could be included in the value of WACC, which is calculated with the formula:

WACC = Wd * Rd * (1-Tc)+We * Re

Jim is the owner and president of ZZZ Company. He and his close friend, Dan, graduated with MBAs. They always dreamed about being successful and making lots of money. They have worked in the same company for years, working their way up to senior management and eventually senior executive roles. ZZZ Company has been a success the entire time that Jim and Dan have worked for the company. Stock prices have increased every year, and revenues have grown by a compounded rate of 20 percent per year. Jim is becoming a little suspicious of the company’s results because the earnings per share are always equal to Wall Street’s projections. In the past couple of years, Jim has noticed that his friend’s personal life has become troubled. Dan has gotten a divorce and is continually struggling financially, even though Jim knows that Dan is making plenty of money to cover his bills. One night, Jim stopped by the office to respond to some e-mails he could not get to during the day. He noticed that Dan was working late as well. Dan was the CEO, and Jim just assumed that he was working late because it was close to the end of the quarter. However, after reviewing the quarter’s results, Jim is suspicious again because the results are exactly equal to Wall Street’s forecasts. Jim decides he needs to begin an investigation into financial reporting practices.

Question: What issues must Jim consider in deciding how to investigate the financial results of the company?

PRINCE Company has the following opening account balances in its general and subsidiary ledgers on March 1^st, 2020. The Company uses the periodic inventory system. All accounts have normal debit and credit balances.

                             General Ledger

The following transactions take place in the month of March 2020.

Jan 1           Purchased merchandise from Heaven Trade $3,500, FOB shipping point, 2/15, n/45.

   1           Paid 12-month fire insurance $7,200, covering year 2020.

   3           Received checks for $4,500 from Westly N.R. and paid $350 to Quick Delivery for the freight on merchandised purchased on January 1^st.

   5           Sent a credit memo of $200 to Fortune D.C. for the allowance granted on unsatisfied merchandise.

   8           Sold merchandise of $3,600 to Zooick, terms FOB destination, 1/8, n/15. The relevant delivery charge, $400, was paid.

   9           Sent a check of $4,900, after a 2% discount, to Heaven Trade. Also, paid DeeBeeDee in full.

   9           Received payment in full from Apple Green and Fortune D.C..

  12          Paid rent of $2,500 for January.

13          Sold merchandise on account to Apple Green $1,900 and Westly N. R. $900, terms 1/8, n/20.

15          Paid Heaven Trade for the Jan.1 purchase.

16          Purchased merchandise on account from DeeBeeDee $15,000, terms 5/5, n/30.

17          Paid $600 cash for office supplies.

18          Returned $1,000 of inferior quality merchandise to DeeBeeDee and receive credit.

20          Cash sales totaled $17,500.

22          Received payment from Apple Green and Zooick.

22          Paid Brothers Inc. $15,300, no discount taken. Also paid DeeBeeDee.

25         Paid salaries of $8,300.

26         Sold merchandise to SunWing, $16,800, terms 1/EOM, n/30.

31          Received from Zooick a down payment of $10,000 for merchandise specifically ordered to its request.

Other information available on January 31^st, 2020

1. A count showed supplies on hand was $1,200.
2. Out of the $3,000 prepaid insurance on January 1^st, $300 was expired.
3. Depreciation expense for the month totaled $225.
4. Ending inventory was $29,000, out of which $1,200 was found to be not sellable anymore. The management decided to recognize a loss separately.
5. Utility bill of $1,350 was received but not yet paid. A separate payable account is used.

Required:

1. Journalize the March transactions in the general journal, no need to provide explanations to the entries. Use additional accounts when necessary.

(30.5 marks)

2. Prepare the Income Statement for the month ended March 31^st, 2020, the Statement of Financial Position as of that date.

(19.5 marks)

PRINCE Company has the following opening account balances in its general and subsidiary ledgers on March 1^st, 2020. The Company uses the periodic inventory system. All accounts have normal debit and credit balances.

                             General Ledger

The following transactions take place in the month of March 2020.

Jan 1           Purchased merchandise from Heaven Trade $3,500, FOB shipping point, 2/15, n/45.

   1           Paid 12-month fire insurance $7,200, covering year 2020.

   3           Received checks for $4,500 from Westly N.R. and paid $350 to Quick Delivery for the freight on merchandised purchased on January 1^st.

   5           Sent a credit memo of $200 to Fortune D.C. for the allowance granted on unsatisfied merchandise.

   8           Sold merchandise of $3,600 to Zooick, terms FOB destination, 1/8, n/15. The relevant delivery charge, $400, was paid.

   9           Sent a check of $4,900, after a 2% discount, to Heaven Trade. Also, paid DeeBeeDee in full.

   9           Received payment in full from Apple Green and Fortune D.C..

  12          Paid rent of $2,500 for January.

13          Sold merchandise on account to Apple Green $1,900 and Westly N. R. $900, terms 1/8, n/20.

15          Paid Heaven Trade for the Jan.1 purchase.

16          Purchased merchandise on account from DeeBeeDee $15,000, terms 5/5, n/30.

17          Paid $600 cash for office supplies.

18          Returned $1,000 of inferior quality merchandise to DeeBeeDee and receive credit.

20          Cash sales totaled $17,500.

22          Received payment from Apple Green and Zooick.

22          Paid Brothers Inc. $15,300, no discount taken. Also paid DeeBeeDee.

25         Paid salaries of $8,300.

26         Sold merchandise to SunWing, $16,800, terms 1/EOM, n/30.

31          Received from Zooick a down payment of $10,000 for merchandise specifically ordered to its request.

Other information available on January 31^st, 2020

1. A count showed supplies on hand was $1,200.
2. Out of the $3,000 prepaid insurance on January 1^st, $300 was expired.
3. Depreciation expense for the month totaled $225.
4. Ending inventory was $29,000, out of which $1,200 was found to be not sellable anymore. The management decided to recognize a loss separately.
5. Utility bill of $1,350 was received but not yet paid. A separate payable account is used.

Required:

Prepare the Income Statement for the month ended March 31st, 2020, the Statement of Financial Position as of that date.

There no adjusted trial balance.

Question 11

--/1

View Policies

Current Attempt in Progress

Windsor Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Wildhorse Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement:

Click here to view factor tables.Prepare the journal entries on the books of Windsor Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places e.g. 5,275.)

eTextbook and Media

List of Accounts

Assuming that Wildhorse exercises its option to purchase the equipment on December 31, 2021, prepare the journal entry to record the sale on Windsor Leasing’s books. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

eTextbook and Media

List of Accounts

Save for Later

Last saved 5 days ago.