Designers need to design how to continue the air in a new building with a 40-year life. Four alternatives
are available, both of which have 20-year lives. Costs are given below. Use 12% interest rate.
A B C D
First Cost 90,000 60,000 85,000 72,000
SV in 20 years 10,000 8,000 12,000 9,000
Ann. Fuel
Cost
3,000 5,000 4,500 3,500
Ann. Maint.
Cost
2,200 3,200 1,800 2,400
Tax (%) of FC 3% 1.5% 2.3% 1.7%
a. What is the present worth of alternative D?(10 points)
b. What is the ROR of Alternative A?(10 points)
c. Which is the best alternative? Use ROR on additional investment.(20points)

(C) ZAPRYL BHD is in the process to finalise its financial statements for the year ended 31 December 2019. Based on its current records, the profit before tax is RM3,200,000 (2018: RM3,000,000). However, the followings have been discovered:

(a) Sales invoices dated 24 December 2018 amounted to RM8,000 and 27 December 2019 amounted to RM10,000 were both fake.

(b) An investment property was purchased in January 2015 at a cost of RM2,000,000 with a useful life of 25 years and was accounted using the cost model. However, for the financial year 2019, the management decided to use the revaluation model whereby the fair value on 31 December 2019 is RM2,800,000 (2018 and 2017: RM2,500,000).

(c) A machinery which was purchased on 4 January 2015 at a cost of RM100,000 has been depreciated using the straight-line method for 10 years useful life with a residual value of RM10,000. Assessment revealed that the machine can be used for another three years with no changes in residual value.

Required:

(i) Classify each of the above events according to MFRS 108 Accounting Policies, Changes in Accounting Estimates and Errors.

(ii) Determine the effect of each of the above events on the profit before tax for the financial year ended 31 December 2018 and 2019 after the adjustments have been recorded.

A year ago, an investor bought 1,000 shares of a mutual fund at the net asset value of $25 per share. The fund distributed dividends of $2.5 and capital gains of $2. Today, the NAV is $28.

a. What’s the holding period return?

b. Assuming all dividends and capital gain distributions are reinvested into additional shares of the fund at an average price of $26 per share. What’s holding period return?

DataSpan, Inc., automated its plant at the start of the current year and installed a flexible manufacturing system. The company is also evaluating its suppliers and moving toward Lean Production. Many adjustment problems have been encountered, including problems relating to performance measurement. After much study, the company has decided to use the performance measures below, and it has gathered data relating to these measures for the first four months of operations.

Management has asked for your help in computing throughput time, delivery cycle time, and MCE. The following average times have been logged over the last four months:

Required:

1- Compute the throughput time for each month. Compute the delivery cycle time for each month. Compute the manufacturing cycle efficiency (MCE) for each month.

2. Evaluate the company’s performance over the last four months.

3-a. Refer to the move time, process time, and so forth, given for month 4. Assume that in month 5 the move time, process time, and so forth, are the same as in month 4, except that through the use of Lean Production the company is able to completely eliminate the queue time during production. Compute the new throughput time and MCE.

3-b. Refer to the move time, process time, and so forth, given for month 4. Assume in month 6 that the move time, process time, and so forth, are again the same as in month 4, except that the company is able to completely eliminate both the queue time during production and the inspection time. Compute the new throughput time and MCE.

The units of an item available for sale during the year were as follows: Jan. 1 Inventory 20 units at $41 Feb. 17 Purchase 12 units at $42 Jul. 21 Purchase 11 units at $45 Nov. 23 Purchase 8 units at $47 There are 10 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to one decimal and final answers to the nearest whole dollar, if required. a. Determine the inventory cost by the first-in, first-out method. $ b. Determine the inventory cost by the last-in, first-out method. $ c. Determine the inventory cost by the weighted average cost method. $

Last year Minden Company introduced a new product and sold 25,200 units of it at a price of $92 per unit. The product's variable expenses are $62 per unit and its fixed expenses are $838,500 per year.

Required:

1. What was this product's net operating income (loss) last year?

2. What is the product's break-even point in unit sales and dollar sales?

3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g., $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit?

Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g., $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit?

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4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3?

Jesper Manufacturing is preparing its master budget for the first quarter of the upcoming year. The following data pertain to Jesper Manufacturing's operations:

1. Actual sales in December were $76,000. Selling price per unit is projected to remain stable at $9 per unit throughout the budget period. Sales for the first five months of the upcoming year are budgeted to be as follows:

2. Sales are 30% cash and 70% credit. All credit sales are collected in the month following the sale.
3. Jesper Manufacturing has a policy that states that each month's ending inventory of finished goods should be 10% of the following month's sales (in units).
4. Of each month's direct material purchases, 20% are paid for in the month of purchase, while the remainder is paid for in the month following purchase. Two kilograms of direct material is needed per unit at $1.40/kg. Ending inventory of direct materials should be 20% of next month's production needs.
5. Monthly manufacturing conversion costs are $6,500 for factory rent, $2,900 for other fixed manufacturing expenses, and $1.40 per unit for variable manufacturing overhead. No depreciation is included in these figures. All expenses are paid in the month in which they are incurred.
6. Computer equipment for the administrative offices will be purchased in the upcoming quarter. In January, Jesper Manufacturing will purchase equipment for $5,800 (cash), while February's cash expenditure will be $11,600 and March's cash expenditure will be $15,800.
7. Operating expenses are budgeted to be $1.20 per unit sold plus fixed operating expenses of $1,400 per month. All operating expenses are paid in the month in which they are incurred.
8. Depreciation on the building and equipment for the general and administrative offices is budgeted to be $5,600 for the entire quarter, which includes depreciation on new acquisitions.
1. Jesper Manufacturing has a policy that the ending cash balance in each month must be at least $4,400. It has a line of credit with a local bank. The company can borrow in increments of $1,000 at the beginning of each month, up to a total outstanding loan balance of $130,000. The interest rate on these loans is 1% per month simple interest (not compounded). Jesper Manufacturing pays down on the line of credit balance if it has excess funds at the end of the quarter. The company also pays the accumulated interest at the end of the quarter on the funds borrowed during the quarter.
10. The company's income tax rate is projected to be 30% of operating income less interest expense. The company pays $10,800 cash at the end of February in estimated taxes.

Requirements:

1. Prepare a schedule of cash collections for January, February, and March, and for the quarter in total.
2. Prepare a production budget. (Hint: Unit sales = Sales in dollars / Selling price per unit.)
3. Prepare a direct materials budget.
4. Prepare a cash payments budget for the direct material purchases from Requirement 3.
5. Prepare a cash payments budget for conversion costs.
6. Prepare a cash payments budget for operating expenses.
7. Prepare a combined cash budget.
8. Calculate the budgeted manufacturing cost per unit. (Assume that fixed manufacturing overhead is budgeted to be $0.80 per unit for the year.)
9. Prepare a budgeted income statement for the quarter ending March 31. (Hint: Cost of goods sold = Budgeted cost of manufacturing each unit x Number of units sold.)
10. Prepare a partial budgeted balance sheet for March 31. Include Loans Payable and Income Tax Payable.
11. Aside from depreciation, can you name another expense that is not payable in cash? (Hint: that expense is not listed in this problem).

The nominal price (per pound) of apples for each year is shown in the timeline below.

What is the real price of apples in year 2002 (as seen from year 2001).

Calculate your answer to the nearest penny (e.g., 3.81)

QUESTION 11

1. Marc and Michelle are married and earned salaries this year of $68,000 and $15,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $3,000 to a qualified Individual Retirement Account, and Marc paid alimony to a prior spouse in the amount of $1,500 (2017 divorce).  Marc and Michelle have a 10-year-old son, Matthew, who lived with them throughout the entire year. Thus, Marc and Michelle are allowed to claim a $2,000 child tax credit for Matthew. Marc and Michelle paid $6,000 of expenditures that qualify as itemized deductions and they had a total of $3,500 in federal income taxes withheld from their paychecks during the course of the year. What is Marc and Michelle’s gross income?

QUESTION 12

1. Same facts as Question 11 – What is Marc and Michelle’s adjusted gross income?

QUESTION 13

1. Same facts as Question 11 – What is Marc and Michelle’s taxable income?

QUESTION 14

1. Same facts as Question 11 – What is Marc and Michelle’s taxes payable or refund due?

Company A and B can borrow for a 3-year term at the following rates. While A desires fixed rate borrowing, B prefers floating rate borrowing.

            Fixed Rate    Floating Rate

A         8.5%               LIBOR + 0.5%

B         7%                  LIBOR

The swap bank currently makes a market for plain vanilla 3-year interest rate swaps at 7.25% - 7.5%.

1. Illustrate how Company A benefits from the use of interest rate swap.
   
2. Summarize the risks taken by the swap bank in the interest swap with Company B.
   
3. Is it feasible for the swap bank to customize an interest rate swap that provide a cost saving of 0.35% to B? Explain.
   
4. Suppose both Company A and B entered into the 3-year swaps with the swap bank. One year after the inception of the 3-year swaps, the swap bank quotes 2-year interest rate swaps at 6.5% - 7%. Which company is willing to unwind the original swap? Explain how much it is willing to pay to unwind.

Please Complete ALL Parts!!!!