Two stars of mass M_?1 and M_?2<M_?1 are orbiting eachother in a circular orbit. The heavy star experiences a supernova explosion, losing most of its mass in a spherically symmetric outflow (i.e. without losing angular momentum) and leaving behind a small neutron star of mass M??_NS. Show that if the mass lost is larger then half of the total mass of the system, the binary is disrupted.

The Harding Corporation has $50 million of bonds outstanding that were issued at a coupon rate of 10.25 percent seven years ago. Interest rates have fallen to 9 percent. Preston Alter, the vice-president of finance, does not expect rates to fall any further. The bonds have 18 years left to maturity, and Preston would like to refund the bonds with a new issue of equal amount also having 18 years to maturity. The Harding Corporation has a tax rate of 25 percent. The underwriting cost on the old issue was 2.5 percent of the total bond value. The underwriting cost on the new issue will be 1.8 percent of the total bond value. The original bond indenture contained a five-year protection against a call, with an 8 percent call premium starting in the sixth year and scheduled to decline by one-half percent each year thereafter (Consider the bond to be seven years old for purposes of computing the premium). Use Appendix D. (Round "PV factor" to 3 decimal places.)

a. Compute the discount rate. (Round the final answer to 2 decimal places.)

Discount rate            6.75 6.75 Correct %

b. Calculate the present value of total outflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.)

Total outflows           $ 3436284 3436284 Incorrect

c. Calculate the present value of total inflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.)

Total inflows           $ 4801477 4801477 Correct

d. Calculate the net present value. (Do not round intermediate calculations. Round the final answer to nearest whole dollar.)

Net present value           $ Not attempted

e. Should the Harding Corporation refund the old issue?

• Yes

• No

The Harding Corporation has $50 million of bonds outstanding that were issued at a coupon rate of 10.25 percent seven years ago. Interest rates have fallen to 9 percent. Preston Alter, the vice-president of finance, does not expect rates to fall any further. The bonds have 18 years left to maturity, and Preston would like to refund the bonds with a new issue of equal amount also having 18 years to maturity. The Harding Corporation has a tax rate of 25 percent. The underwriting cost on the old issue was 2.5 percent of the total bond value. The underwriting cost on the new issue will be 1.8 percent of the total bond value. The original bond indenture contained a five-year protection against a call, with an 8 percent call premium starting in the sixth year and scheduled to decline by one-half percent each year thereafter (Consider the bond to be seven years old for purposes of computing the premium). Use Appendix D. (Round "PV factor" to 3 decimal places.) a. Compute the discount rate. (Round the final answer to 2 decimal places.) Discount rate 6.75 6.75 Correct % b. Calculate the present value of total outflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.) Total outflows $ 3436284 3436284 Incorrect c. Calculate the present value of total inflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.) Total inflows $ 4801477 4801477 Correct d. Calculate the net present value. (Do not round intermediate calculations. Round the final answer to nearest whole dollar.) Net present value $ Not attempted e. Should the Harding Corporation refund the old issue? Yes No The The Harding Corporation has $50 million of bonds outstanding that were issued at a coupon rate of 10.25 percent seven years ago. Interest rates have fallen to 9 percent. Preston Alter, the vice-president of finance, does not expect rates to fall any further. The bonds have 18 years left to maturity, and Preston would like to refund the bonds with a new issue of equal amount also having 18 years to maturity. The Harding Corporation has a tax rate of 25 percent. The underwriting cost on the old issue was 2.5 percent of the total bond value. The underwriting cost on the new issue will be 1.8 percent of the total bond value. The original bond indenture contained a five-year protection against a call, with an 8 percent call premium starting in the sixth year and scheduled to decline by one-half percent each year thereafter (Consider the bond to be seven years old for purposes of computing the premium). Use Appendix D. (Round "PV factor" to 3 decimal places.) a. Compute the discount rate. (Round the final answer to 2 decimal places.) Discount rate 6.75 6.75 Correct % b. Calculate the present value of total outflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.) Total outflows $ 3436284 3436284 Incorrect c. Calculate the present value of total inflows. (Do not round intermediate calculations. Enter the answers in whole dollars, not in millions. Round the final answer to nearest whole dollar.) Total inflows $ 4801477 4801477 Correct d. Calculate the net present value. (Do not round intermediate calculations. Round the final answer to nearest whole dollar.) Net present value $ Not attempted e. Should the Harding Corporation refund the old issue? Yes No

You are trying to price two bonds that have the same maturity and par value but different coupon rates and different required rates of return. Both bonds mature in 3 years and have par values of $1000. One bond has a coupon rate of 7% and a required rate of return of 7%. The other bond has a coupon rate of 5% and a required rate of return of 5%. What is the absolute value of the difference between the price of these two bonds?
$

You should set your calculator for at least four decimal places of accuracy.
Place your answer in dollars and cents.

Do not include a dollar sign or comma in your answer.

The following table contains observed frequencies for a sample of 200.

Test for independence of the row and column variables using a= .05

Compute the value of the  test statistic (to 2 decimals).

Breakin Away Company has three employees-a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee:

For the current pay period, the computer programmer worked 60 hours and the administrator worked 50 hours. The federal income tax withheld for all three employees, who are single, can be determined by adding $356.90 to 28% of the difference between the employee's amount subject to withholding and $1,796.00. Assume further that the social security tax rate was 6%, the Medicare tax rate was 1.5%, and one withholding allowance is $70.

Determine the The total earnings of an employee for a payroll period.gross pay and the Gross pay less payroll deductions; the amount the employer is obligated to pay the employee.net pay for each of the three employees for the current pay period. Assume the normal working hours in a week are 40 hours. If required, round your answers to two decimal places.

An electronics firm manufactures two types of personal computers (PC), a desktop model and a laptop model. The production of a desktop computer requires a capital expenditure of $400 and 40 hours of labor. The production of a laptop computer requires a capital expenditure of $250 and 30 hours of labor. The firm has $20,000 capital and 2,160 labor-hours available for production of desktop and laptop computers. Each desktop computer contributes a profit of $320 and each laptop computer contributes a profit of $220.

What are the corner points of the feasible region if we want to maximize the profit?

(a) (50, 0),(30, 32),(0, 72) ;

(b) (50, 0),(54, 0),(30, 32) ;

(c) (0, 80),(0, 72),(30, 32) ;

(d) (0, 0),(50, 0),(30, 32),(0, 72) ;

(e) (0, 0),(50, 0),(0, 72) ;

What are the decision variables if we want to maximize the profit?

(a) x1, x2 and x3 ;

(b) number of desktop and number of laptop to be made ;

(c) x and y ;

(d) x, y and z ;

(e) x1 and x

4-22 (Objectives 4-5 , 4-7) Each of the following situations involves a possible violation of the AICPA Code of Professional Conduct. For each situation, state the applicable rule of conduct and whether it is a violation.

1. Emrich, CPA, provides tax services, management advisory services, and bookkeeping services and also conducts audits for the same nonpublic client. Because the firm is small, the same person often provides all the services.

2. Steve Custer, CPA, set up a casualty and fire insurance agency to complement his auditing and tax services. He does not use his own name on anything pertaining to the insurance agency and has a highly competent manager, Jack Long, who runs it. Custer often requests Long to review the adequacy of a client’s insurance with management if it seems underinsured. He believes that he provides a valuable service to clients by informing them when they are underinsured.

3. Seven small Seattle CPA firms have become involved in an information project by taking part in an interfirm working paper review program. Under the program, each firm designates two partners to review the audit files, including the tax returns and the financial statements, of another CPA firm taking part in the program. At the end of each review, the auditors who prepared the working papers and the reviewers have a conference to discuss the strengths and weaknesses of the audit. They do not obtain authorization from the audit client before the review takes place.

4. Franz Marteens is a CPA, but not a partner, with three years of professional experience with Roberts and Batchelor, CPAs. He owns 25 shares of stock in an audit client of the firm, but he does not take part in the audit of the client, and the amount of stock is not material in relation to his total wealth.

5. A nonaudit client requests assistance of M. Wilkenson, CPA, in the installation of a local area network. Wilkenson has no experience in this type of work and no knowledge of the client’s computer system, so he obtains assistance from a computer consultant. The consultant is not in the practice of public accounting, but Wilkenson is confident of his professional skills. Because of the highly technical nature of the work, Wilkenson is not able to review the consultant’s work.

6. In preparing the personal tax returns for a client, Sarah Milsaps, CPA, observed that the deductions for contributions and interest were unusually large. When she asked the client for backup information to support the deductions, she was told, “Ask me no questions, and I will tell you no lies.” Milsaps completed the return on the basis of the information acquired from the client.

7. Roberta Hernandez, CPA, serves as controller of a U.S.-based company that has a significant portion of its operations in several South American countries. Certain government provisions in selected countries require the company to file financial statements based on international standards. Roberta oversees the issuance of the company’s financial statements and asserts that the statements are based on international financial accounting standards; however, the standards she uses are not those issued by the International Accounting Standards Board.

8. Archer Ressner, CPA, stayed longer than he should have at the annual holiday party of Ressner and Associates, CPAs. On his way home he drove through a red light and was stopped by a police officer, who observed that he was intoxicated. In a jury trial, Ressner was found guilty of driving under the influence of alcohol. Because this was not his first offense, he was sentenced to 30 days in jail and his driver’s license was revoked for one year.

Use SPSS for this Application Exercise:
A pharmaceutical company tested three formulations of a pain relief medicine for migraine headache sufferers. Volunteers were selected and randomly assigned to one of the three drug formulations. The volunteers were instructed to take the drug during their next migraine headache episode and to report their pain on a scale of 1 to 10 (10 being most pain). The data are below. What can be concluded with ? = 0.05?

a) What is the appropriate test statistic?
---Select--- na one-way ANOVA within-subjects ANOVA two-way ANOVA

b) Compute the appropriate test statistic(s) to make a decision about H₀.
p-value =  ; Decision:  ---Select--- Reject H0 Fail to reject H0

c) Using the SPSS results, compute the corresponding effect size(s) and indicate magnitude(s).
?² =  ;  ---Select--- na trivial effect small effect medium effect large effect

d) Make an interpretation based on the results.

At least one of the formulations differ on pain.None of the formulations differ on pain.   

Suppose your research assistant screwed up and lost the information that linked the person’s identity across the two weight loss periods. This makes it impossible to run a paired t-test. Rather than start over:

a) Compute the mean and standard deviation of the two samples (2-pts)

b) Compute the two sample t-statistic (2pts)

c) How many degrees of freedom do you have(3pts)?

d) compute the P-value (4pts)

e) How does this P-value compare to the one you just computed using the paired ttest? (3pts))

Two Sample t-test (16pts):

Suppose you are interested in deciding if the 1990 Toyota Four Runner has been equally reliable as the 1990 Honda Passport. You go out a randomly sample of 5 people who own a 1990 Toyota and 5 other people who own a 1990 Honda and you ask them how often they have to take their vehicles in for maintenance. Here are your data (in thousands of miles):

Toyota: 30 35 32 34 30

Honda: 29 33 28 31 27

a) State the null and alternative hypotheses (2pts)

b) Compute the means and standard deviations of the two samples (2-pts)

c) Compute the two sample t-statistic (2 pts)

c) How many degrees of freedom do you have? (3pts)

d) Compute the P-value (4pts)

e) At an alpha = 0.05 would you accept or reject the null hypothesis? (3pts)

Please show work! thank you!

There are 23 families living in the Willbrook Farms Development. Of these families, 10 prepared their own federal income taxes for last year, 5 had their taxes prepared by a local professional, and the remaining 8 by H&R Block.

1. What is the probability of selecting a family that prepared their own taxes? (Round your answer to 2 decimal places.)

2. What is the probability of selecting two families, both of which prepared their own taxes? (Round your answer to 4 decimal places.)

3. What is the probability of selecting three families, all of which prepared their own taxes? (Round your answer to 4 decimal places.)

4. What is the probability of selecting two families, neither of which had their taxes prepared by H&R Block? (Round your answer to 4 decimal places.)