1.When Steve died, his wife Linda was the sole beneficiary of his $50,000 life insurance policy. How will the $50,000 life insurance proceeds affect Linda’s gross income?

2.For tax purposes in 2018, A&P had operating income of $375,000 and operating expenses of $128,000. Included in A&P’s expenses is $22,000 for bad debts write-offs during 2018. In January of 2019, they received $7,000 from an account that was written off as a bad debt in 2018. What effect does this collection have on A&P’s 2019 taxable income? Can you tell whether A&P is a cash-basis or accrual basis taxpayer, and explain why?

On January 2, 2018, All Good Company purchased 7,000 shares of the stock of Big Bad Company, and DID obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $11 per share, and represents a 30% ownership stake. Big Bad Company made $300,000 of net income in 2018, and paid dividends to All Good Company of $40,000 on December 15, 2018. Big Bad Company's stock was trading on the open market for $19 per share at the end of the year. Use this information to determine the book value of the investment that should be reported at year end by All Good Company. Round to nearest whole dollar.

II. On October 1, 2018, Raven Company issued $400,000 par value bonds dated July 1, 2018. The 10-year bonds have a stated rate of 10%   and pay interest semiannually on January 1 and July 1. The bonds are issued at $454,200 plus accrued interest, and yield 8%. The effective interest method is used.   

Required:

1. Prepare the journal entry at the date the bond are issued.
2. Prepare the adjusting entry at December 31, 2018.
3. Prepare the entry for interest payment on January 1, 2019.
4. What would be the difference if we assume that that the straight line method was used instead of the effective interest method in amortizing the discount or premium?

On January 2, 2018, All Good Company purchased 5,000 shares of the stock of Big Bad Company, and DID obtain significant influence. The investment is intended as a long-term investment. The stock was purchased for $17 per share, and represents a 30% ownership stake. Big Bad Company made $400,000 of net income in 2018, and paid dividends to All Good Company of $40,000 on December 15, 2018. Big Bad Company's stock was trading on the open market for $17 per share at the end of the year. Use this information to determine the book value of the investment that should be reported at year end by All Good Company. Round to nearest whole dollar.

.No.1: It is the end of September 2018. The current PKR/USD exchange rate is
135.26, the Pakistani and US three-month interest rates are 6% and 4.5% per annum
respectively. A forecast indicates that the exchange rate at the end of 2018 will be 128.50.
a) What would you do based on this information if you expect to receive USD 50000 at
the end of year 2008?
b) If the actual exchange rate turns out to be 136.50, calculate the percentage forecasting
error.
c) If you expect a forward contract for end of 2018 at an exchange rate 132.75, will you
hedge it or not?
d) Based on answer in part c), how much profit/loss was incurred by acting on this
forecast? (Marks 06

Jonathan operates a business as a sole proprietor. His business is a lawn service and landscaping business. In July 2018, Jonathan purchased two new lawn mowers at a cost of $6,000 each. He also purchased a new warehouse to store all the equipment in. The warehouse cost $200,000 and he purchased it in August 2018 In 2020, Jonathan had the following items of income and deduction:

$70,000 of income form lawn service $20,000 in expenses related to his business Sale of the warehouse for $210,000   Sale of one mower (purchased in 2018) for $4,000

Please calculate Jonathan's taxable income and any special issues relating to how the income will be taxed for 2020.

The following chart shows the number of customer complaints from three regions of an organization for two separate years. 2018 2017 Northeast region 6,493 3,401 Southeast region 732 2,513 Central region 3,706 1,082 • Find the probability for each question. (75 words, or 1 paragraph)

o What is the probability that a complaint was from the Southeast region, given it was in 2017? o What is the probability that a complaint was from the Central region, given it was in 2018? o What is the probability that a given complaint did not occur in 2018 and was not from the Southeast region? o What is the probability that two complaints chosen at random were both from the Northeast region?

1. On January 1, 2018, ABC Company awarded 15M of its $1 par common shares to key personnel, subject to forfeiture if employment is terminated by the end 2020. On the date of the grant, the stock had a market price of $3 per share.

1. What is the total Compensation Expense pertaining to the restricted shares.

2. What is the journal entry on the date of the grant, January 1, 2018?

3. What is the journal entry to record the compensation expense on Dec 31, 2018?

4. What is the journal entry to record the compensation expense on Dec 31, 2019?

5. What is the journal entry to record the compensation expense on Dec 31, 2020?

6. What is the journal entry on the lifting of restrictions on December 31, 2020?

In May 2018, the Gallup surveyed 1,024 American adults and found that 60 percent believed abortion should be legal within the first trimester of pregnancy. In 1996, Gallup asked the same question among 550 adults and found that 64 percent believed abortion should be legal within the first trimester of pregnancy.

a) Find the 95 percent confidence interval of the population proportion of adult Americans that support legal abortion within the first trimester of pregnancy in 2018.
b) Using ? = 0.01, derive and evaluate the rejection rule where the null hypothesis is that attitudes towards abortion have not changed from 1996 to 2018 against a two-sided alternative.