Rust Pipe Co. was established in 1994. Four years later the company went public. At that time, Robert Rust, the original owner, decided to establish two classes of stock. The first represents Class A founders' stock and is entitled to twelve votes per share. The normally traded common stock, designated as Class B, is entitled to one vote per share. In late 2010, Mr. Stone, an investor, was considering purchasing shares in Rust Pipe Co. While he knew the existence of founders’ shares were not often present in other companies, he decided to buy the shares anyway because of a new technology Rust Pipe had developed to improve the flow of liquids through pipes. Of the 1,600,000 total shares currently outstanding, the original founder's family owns 52,125 shares. What is the percentage of the founder's family votes to Class B votes?

Rust Pipe Co. was established in 1994. Four years later the company went public. At that time, Robert Rust, the original owner, decided to establish two classes of stock. The first represents Class A founders' stock and is entitled to eleven votes per share. The normally traded common stock, designated as Class B, is entitled to one vote per share. In late 2010, Mr. Stone, an investor, was considering purchasing shares in Rust Pipe Co. While he knew the existence of founders’ shares were not often present in other companies, he decided to buy the shares anyway because of a new technology Rust Pipe had developed to improve the flow of liquids through pipes.

Of the 2,150,000 total shares currently outstanding, the original founder's family owns 53,225 shares.

What is the percentage of the founder's family votes to Class B votes?

Discuss the relationship between the M/M/1 queue and the situation described in problem 9 of homework 3.

What similarities are there between arrival processes in these two examples?

What about similarities in service-time distribution?

Compute the stationary distribution of the Markov chain obtained in problem 9 of homework 3 under the assumption that p < q. Explain the significance of this assumption.

problem 9 of homework 3

Suppose customers can arrive to a service station at times n = 0, 1, 2, .... In any given period, independent of everything else, there is one arrival with probability p, and there is no arrival with probability 1 − p. Suppose customers are served one-at-a-time on a first-come-first-served basis. If at the time of an arrival, there are no customers present, then the arriving customer immediately enters service. Otherwise, the arrival joins the back of the queue.

In a time period n, events happen in the following order: (i) arrivals, if any, occur; (ii) service completions, if any, occur; (iii) service begins on a new customer if there has been an arrival to an empty queue or a service has just finished and there is another customer present.

Assume that service times are i.i.d. geometric random variables (each with parameter q) that are independent of the arrival process. Note that a customer who enters service in time t can complete service, at the earliest, in time t+1 (in which case his service time is 1).

Let Xn be the number of customers at the station at the end of time period n; i.e., after the time-n arrivals and services. Note that Xn includes both customers waiting as well as any customer being served.

Entries and Schedules for Unfinished Jobs and Completed Jobs

Hildreth Company uses a job order cost system. The following data summarize the operations related to production for April, the first month of operations:

1. Materials purchased on account, $3,180.
2. Materials requisitioned and factory labor used:
   

   Job No.	Materials		Factory Labor
   101	$2,610		$2,520
   102	3,180		3,400
   103	2,110		1,660
   104	7,150		6,250
   105	4,540		4,760
   106	3,310		3,020
   For general factory use	890		3,730

3. Factory overhead costs incurred on account, $4,990.
4. Depreciation of machinery and equipment, $1,790.
5. The factory overhead rate is $50 per machine hour. Machine hours used:
   

   Job No.	Machine Hours
   101		24
   102		18
   103		27
   104		73
   105		21
   106		22
   Total		185

6. Jobs completed: 101, 102, 103, and 105.
7. Jobs were shipped and customers were billed as follows: Job 101, $7,600; Job 102, $8,980; Job 105, $14,850.

Required:

1. Journalize the entries to record the summarized operations. If an amount box does not require an entry, leave it blank.

2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.

3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.

4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.

Entries and Schedules for Unfinished Jobs and Completed Jobs

Hildreth Company uses a job order cost system. The following data summarize the operations related to production for April, the first month of operations:

1. Materials purchased on account, $2,080.
2. Materials requisitioned and factory labor used:
   

   Job No.	Materials		Factory Labor
   101	$1,800		$2,940
   102	2,200		3,970
   103	1,460		1,940
   104	4,930		7,290
   105	3,130		5,560
   106	2,290		3,530
   For general factory use	610		4,350

3. Factory overhead costs incurred on account, $3,440.
4. Depreciation of machinery and equipment, $2,090.
5. The factory overhead rate is $40 per machine hour. Machine hours used:
   

   Job No.	Machine Hours
   101		43
   102		18
   103		27
   104		70
   105		45
   106		29
   Total		232

6. Jobs completed: 101, 102, 103, and 105.
7. Jobs were shipped and customers were billed as follows: Job 101, $7,750; Job 102, $8,270; Job 105, $12,990.

Required:

1. Journalize the entries to record the summarized operations. If an amount box does not require an entry, leave it blank.

2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.

3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.

4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.

Cholesterol levels are a major concern to health insurance providers. Cholesterol levels in U.S. adults average 215 with a standard deviation of 30. If the cholesterol levels of a sample of 42 U.S. adults is taken, what is the probability that the mean cholesterol level of the sample 1) Will be less than 200? 2) Will be between 205 and 225? 3) Will be greater than 220?

2. Suppose that 36% of the clients of a company use smart phones. Draw a random sample of 200 clients, what is the probability that the sample proportion is 1) Less than 0.28? 2) Greater than 0.42?

3. A bottler wishes to ensure that the average of 16 ounces of fruit juice is used to fill each bottle. In order to analyze the accuracy of the bottling process, he takes a random sample of 48 bottles. The mean weight of the juice in the sample is 15.8 ounces. Assume the population standard deviation is 0.8 ounce. Test his concern at the 5% significance level.

4. In a sample of 1022 U.S. adults, 73% say that they are not happy with the current investment climate. Is there evidence that the percentage has significantly decreased from the 74% reported previously? Do the test at the 1% level.

5. The percentage of bills being paid by Medicare has been 31%. An examination of 8368 recent bills reveals that 32% of these bills are being paid by Medicare. Is this evidence of a change in the percentage of bills being paid by Medicare? Do the test at the 10% level.

1. Under absorption costing, a company had the following unit costs when 8,000 units were

             produced.        

Compute the total production cost per unit under variable costing if 25,000 units had been produced.

A) $31.75

B) $27.25

C) $26.25

D) $24.25

E) $17.50

2.         When evaluating a special order, management should:

A) Only accept the order if the incremental revenue exceeds all product costs.

B) Only accept the order if the incremental revenue exceeds fixed product costs.

C) Only accept the order if the incremental revenue exceeds total variable product costs.

D) Only accept the order if the incremental revenue exceeds full absorption product costs.

E) Only accept the order if the incremental revenue exceeds regular sales revenue.

3.       Which of the following best describes costs assigned to the product under the absorption

             costing method?

Direct labor (DL)

Direct materials (DM)

Variable selling and administrative (VSA)

Variable manufacturing overhead (VOH)

Fixed selling and administrative (FSA)

Fixed manufacturing overhead (FOH)

A) DL, DM, VSA, and VOH.

B) DL, DM, and VOH.

C) DL, DM, VOH, and FOH.

D) DL and DM.

E) DL, DM, FSA, and FOH.

4.       Which of the following best describes costs assigned to the product under the variable

             costing method?

Direct labor (DL)

Direct materials (DM)

Variable selling and administrative (VSA)

Variable manufacturing overhead (VOH)

Fixed selling and administrative (FSA)

Fixed manufacturing overhead (FOH)

A) DL, DM, VSA, and VOH.

B) DL, DM, and VOH.

C) DL, DM, VOH, and FOH.

D) DL and DM.

E) DL, DM, FSA, and FOH.

12.       Howley Company has the following information for April:

                        Sales                            $912,000

                        VC of goods sold           474,000

                        FC – mfg.                          82,000

                        VC – selling & adm.       238,000

                        FC – selling & adm.          54,700

a, Operating Income for Howley during the month of April.

Companies sometimes offer their customers a discount on their purchase if they pay early. What is the benefit for the company to take a reduced amount on these purchases and from the customer’s point of view is it beneficial for them to take the discount. What factors does the customer have to consider when deciding to take the discount?