1. The Statement of Cash Flows does not report the effects of

: Select one: a. Cash dividends paid. b. Common shares issued for cash to pay for assets or to pay debt. c. Common shares purchased for cancellation. d. Common shares issued as the result of a stock dividend

2.

Which of the following loss contingencies ordinarily will NOT be accrued as liabilities?

Select one:

a. Guarantees of indebtedness of others.

b. Pending lawsuits whose outcome is uncertain.

c. None of these will be accrued

d. Disputes over additional income taxes for prior years.

3. The January 1, 2006 status of long-term construction project No. 6 is as follows. Assume the completed contract method.
Costs incurred to date $20,000
Contract price $80,000
Estimated remaining cost to complete is $40,000
On December 31, 2006, the estimated remaining cost to complete was still $40,000, and $25,000 of cost had been incurred during 2006. What is the January 1, 2007 balance of Construction-in-Process?

Select one:

a. $45,000

b. $50,000

c. $30,000

d. $40,000

4. Which of the following is the most conservative (slowest to recognize) revenue recognition method?

Select one:

a. Instalment method of revenue recognition

b. Production method

c. Cost recovery method

d. Percentage of completion method

5.

Which of the following would be non-adjusting subsequent event(s)?

Select one:

a. Bankruptcy filing by the company's major customer, which accounted for 60% of the company's receivables at the balance sheet date.

b. An insured fire loss shortly after the company's year-end.

c. The company announces restructuring plans shortly before its year-end.

d. A sale of goods to a Company with good current ratio

The Z-score bankruptcy model uses balance sheet and income information to arrive at a Z-Score, which can be used to predict financial distress. The Model follows:

Z= ((Working capital / Total assets) x 1.2) + ((Retained earnings /Total assets ) x 1.4) + ((EBIT / Total Assets) x 3.3) + ((Sales / Total assets ) x 0.99) + ((MV Equity / total liabilities) x 0.6)

EBIT is Earnings before Interest and Taxes.

MB Equity is the market value of common equity, which can be determined by multiplying stock price by shares outstanding.

Following extensive testing, it has been shown that companies with Z-scores above 3.0 are unlikely to fail; those with Z-scores below 1.81 are very likely to fail. While the original model was developed for publicly held manufacturing companies, the model has been modified to apply to companies in various industries, emerging companies, and companies not traded in public markets.

For this discussion choose two publicly traded companies that you can find the financial statements for - one obviously profitable and the other either closed or going through bankruptcy ( Sears, KMart, etc). Compute the z-scores for the two latest years provided and interpret the results. Where do the company's fall in the financial distress range? Share the companies you chose, the Z-scores for each, and how this information helps you understand the companies. Can you use this model to analyze your own company or others you may be interested in?

1. Based on the tables below, write SQL command to perform the following tasks for MySql:

1. Create SALESREP and CUSTOMER tables
2. Create primary and foreign keys as appropriate. The custNo should use a surrogate key as the primary key with auto-increment
3. increase the balance of the Gonzales account by $100 to a total of $450?
4. Find an average customer balance
5. Display the name of the sales representative and the name of the customer for each customer that has a balance greater than 400

SALESREP

CUSTOMER

In February of 2010 the SEC announced a new time line calling for publicly traded companies to switch from GAAP to a different set of accounting standards, called IFRS, by 2015. Now that it is 2017, do some research on the impact this switch will have on US companies. Based on your research, what are the key advantages and major challenges associated with making the proposed switch?

Required: 2 paragraphs outlining the advantages and disadvantages.

"Cash is king," but is that the whole story?

Ch. 5 discusses the importance of cash flow in the operation of a successful business. Drawing from your professional or personal experience, or from your research skills (researching news articles or publicly traded companies' corporate annual reports), explain a situation in which a profitable organization had negative cash flows or when an organization experiencing a loss had positive cash flow.

After reading Special Topic 5, write a 2-page paper answering the following: Why did housing prices rise rapidly during 2002 - 2005? Why did the mortgage default rate increase so sharply during 2006 and 2007 even before the 2008 - 2009 recession began? What did the Community Reinvestment Act have to do with the housing bubble and collapse? Cite your sources as needed. Use APA formatting. View your assignment rubric.

Suppose you are given the following end of year stock price data for Random Inc. stock. Assume the returns are normally distributed, calculate the minimum value that an investor eared during any given year of the sample. (Enter percentages as decimals and round to 4 decimals).

You are a designated accountant (CPA) working as the Controller for Orion Enterprises, a widely diversified company. As many publicly-traded companies do, Orion requires its senior managers to own shares in the company, as a condition of your employment.In your role as Controller, you are as a matter of course knowledgeable about the company’s performance, both forecast and actual. This morning, your senior accounting clerk prepared the draft financial statements for the current quarter. The preliminary net income for the quarter looks like it will be substantially larger than had been previously forecast. Because of this, you anticipate that the share price of the company will rise considerably when the quarterly results are released to the public.

Should you buy more shares in Orion Enterprises before the quarterly results are released to the public and the price increases? Provide at least four reasons for your action.

On December 31, 2013, the Mallory Corporation had the following activity in its fixed assets

record. Assume all assets were purchased on January 1.

REQUIRED:

· Compute the depletion, amortization, and depreciation expense on December 31, 2013 for each asset listed above.

· Record the entries for the assets above

· Suppose that we sold machine 2 for $50,000, record the entry

· Suppose that the building life increased from 25 years to 30 years, revise the depreciation and prepare the entry.

· Suppose that the corporation spent $20,000 in 2013 to defend the patent.  Record the entry.

You are the in-house counsel for a small bank (the “Bank”) located in Northwest Colorado. The Bank has three locations: Steamboat Springs, Hayden and Craig. The Bank offers a broad range of banking services, such as making personal and commercial loans and offering various types of savings and checking accounts. The vast majority of the Bank’s customers live in Routt, Moffat and Rio Blanco Counties. The Bank has a reputation as being a friendly, small town bank that knows its customers by name. The Bank sponsors and helps organize many local community activities. The Bank is a publicly traded company. During the past several years, the price of the Bank’s stock has fallen at alarming rates. This is mainly due to decreased profits. Many of the Bank’s customers work for the coal, oil and gas industries, and with recent regulations and falling energy prices, many have lost their jobs and cannot afford to use the Bank’s services to buy cars, real estate or start businesses that require loans. Shareholders are losing faith in the Bank, and because of the mass of selling of its stock, its price has fallen by 50% in the past three years. Major shareholders are demanding that the Bank take initiative immediately to generate more revenue. The CEO of the Bank wants your advice on whether the Bank should get into the business of subprime lending. That is, relax its own lending standards to allow customers with poor credit to obtain a loan by putting as little as 3% down. Currently, the Bank requires a down payment of at least 15%, and only lends to customers with good or great credit scores. The CEO thinks that subprime lending will immediately generate additional revenue without adding to the Bank’s risk. Once the Bank makes the loan, it will sell the promissory note and deed of trust or security agreement to another financial institution for less than the total repayment amount, but more than the original amount. For example, if the Bank lends its customer $200,000 to buy a house, and the total repayment owed including interest is $350,000, the Bank could sell the debt for $250,000 and make a $50,000 profit in a short period of time. The customer would then make payments to the company that bought the debt from the Bank. The CEO says that the practice of relaxing its lending standards will allow local residents who are short on money to obtain loans to buy homes or start businesses. Please write a memorandum to the CEO counseling her on whether the Bank should, in your opinion, relax its lending standards and get into the business of subprime lending. Make sure to support your opinion with evidence such as laws that apply, historical examples, etcetera. You may use the information you learned in class, but you will also have to conduct your own research via the internet. As the attorney for Bank, you may provide both legal advice and practical advice.

Factors you should discuss include: What, if any, legal implications are there? (For example, are subprime loans allowed? Are there any laws that govern subprime loans?) What, if any, financial implications are there? (What are the possible good and bad things that could happen to the finances of the customers, the Bank, the Bank’s shareholders, and the economy in general?) What, if any, ethical implications are there? (For example, should the Bank be responsible for the higher risk that the customers will not be able to repay the loan? How should the Bank balance its own interest in making a profit versus protecting customers from risky loans?) Are there any other issues you think the CEO should know about before making a decision? If the Bank starts offering subprime loans, what precautions should it take in order to minimize the risks you think are greatest?