Amalgamated General Corporation is a consulting firm that also offers financial services through its credit division. From time to time the company buys and sells securities. The following selected transactions relate to Amalgamated’s investment activities during the last quarter of 2021 and the first month of 2022. The only securities held by Amalgamated at October 1, 2021 were $60 million of 10% bonds of Kansas Abstractors, Inc., purchased on May 1, 2021 at face value and held in Amalgamated’s trading securities portfolio. The company’s fiscal year ends on December 31.

Required:
Prepare the appropriate journal entry for each transaction or event. Use one summary entry on December 31 to adjust the portfolio of equity investments to fair value. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place, (i.e., 5,500,000 should be entered as 5.5).)

Record the purchase of 2 million shares of Millwork Ventures Company common stock for $71 million.

• Record the receipt of semiannual interest of $2.4 million from the Kansas Abstractors bonds.
• Record the purchase of 10% bonds of Holistic Entertainment Enterprises at their $18 million face value.
• Record the entry to adjust to fair value the investment in Kansas Abstractor bonds on the date of sale.
• Record the sale of the investment in Kansas Abstractors bonds.
• Record the purchase of 12% bonds of Household Plastics Corporation at their $60 million face value.
• Record the purchase of U.S. Treasury bonds for $7.6 million.
• Record the purchase of 4 million common shares of NXS Corporation for $56 million.
• Record the entry to adjust to fair value the investment in U.S. Treasury bonds on the date of sale.
• Record the sale of the Treasury bonds for $7.8 million.
• Record the receipt of cash dividends of $11 million from the Millwork Ventures Company common shares.
• Record the accrued interest for Holistic Entertainment bonds.
• Record the accrued interest for Household Plastics bonds.
• Record the entry to adjust the securities to fair value.
• Record the entry to adjust to fair value the investment in NXS Corporation common shares on the date of sale.
• Record the sale of the NXS Corporation common shares for $54 million.

The balance in Unearned Revenues prior to adjustment was $3,650. If the amount still unearned as of the end of the period is $1,900?, the adjusting entry needed would be? to:

A.

debit Unearned Service? Revenue,

$1,750?;

credit Service? Revenue,

$1,750.

B.

debit? Cash,

$3,650?;

credit Unearned Service? Revenue,

$3,650.

C.

debit Service? Revenue,

$1,750?;

credit Unearned Service? Revenue,

$1,750.

D.

debit Unearned Service? Revenue,

$1,900?;

credit Service? Revenue,

$1,900.

Of the? following, which is NOT classified as an investing activity on the Statement of Cash? Flows?

A.

Selling goods and services

B.

Collecting the principal on loans

C.

Purchasing land

D.

Sale of equipment for cash

38) The balance in Unearned Revenues prior to adjustment was $3,650. If the amount still unearned as of the end of the period is $1,900, the adjusting entry needed would be to: A. debit Unearned Service Revenue, $1,750; credit Service Revenue, $1,750. B. debit Cash, $3,650; credit Unearned Service Revenue, $3,650. C. debit Service Revenue, $1,750; credit Unearned Service Revenue, $1,750. D. debit Unearned Service Revenue, $1,900; credit Service Revenue, $1,900. 39) Of the following, which is NOT classified as an investing activity on the Statement of Cash Flows? A. Selling goods and services B. Collecting the principal on loans C. Purchasing land D. Sale of equipment for cash

Draw a demand curve that shows an decrease in price (from P1 to P2) and the corresponding change in quantity demand (from Q1 to Q2) leaving the revenue unchanged.

Use the graph to show the initial and the final revenue. Make sure that the area indicating the revenue is, in fact, constant.

Add a (simple) scale to your axes and calculate the initial revenue, the loss and gain in revenue due to the price increase, and the final revenue.

Variable Names: Year = year of manufacture, Cruise = best cruise speed (knots indicated air speed) at 65%-75% power, TotalHP = total horsepower (both engines if twin), NumBlades = number of propeller blades, Turbo = 1 if turbocharged, 0 otherwise

Using Cruise as the response variable and the other variables as predictor variables, use Minitab to perform the necessary regression calculations. Write a concise report answering the following questions. Insert tables and graphs in your report as appropriate.

1.      Use Minitab to perform multiple regression.   Use Cruise as the dependent variable, and the other variables, (Year, TotalHp, NumBlades, and Turbo) as predictor variables.

2.      Is multicollinearity a problem? Support your answer.

3.      Is the model significant? Support your answer. What does this tell you?

4.      Find the sample regression equation and interpret the coefficients in terms of the problem.

5.      Find and interpret the coefficient of determination.

6.      Test each regression coefficient for significance and interpret the results.

7. Which variable is the indicator (dummy) variable? Give and compare the sample regression equations for both levels of the dummy variable.

8.      Give a 95% confidence interval for average cruise speed for all airplanes manufactured in 1990, with 600 horsepower, 3 blades, and turbocharged. Interpret your interval. Give and interpret a 95% prediction interval using the same values.

9.      Examine the residual plots and discuss.

Bank of America's Consumer Spending Survey collected data on annual credit card charges in seven different categories of expenditures: transportation, groceries, dining out, household expenses, home furnishings, apparel, and entertainment (U.S. Airways Attache, December 2003). Using data from a sample of 42 credit card accounts, assume that each account was used to identify the annual credit card charges for groceries (population 1) and the annual credit card charges for dining out (population 2). Using the difference data, the sample mean difference was     = $859, and the sample standard deviation was sd = $1,213.

What is the point estimate of the difference between the population means? $

What is the 95% confidence interval estimate of the difference between the population means (to the nearest whole number)?

Bank of America's Consumer Spending Survey collected data on annual credit card charges in seven different categories of expenditures: transportation, groceries, dining out, household expenses, home furnishings, apparel, and entertainment (U.S. Airways Attache, December 2003). Using data from a sample of 42 credit card accounts, assume that each account was used to identify the annual credit card charges for groceries (population 1) and the annual credit card charges for dining out (population 2). Using the difference data, the sample mean difference was     = $859, and the sample standard deviation was sd = $1,213.

What is the point estimate of the difference between the population means? $

What is the 95% confidence interval estimate of the difference between the population means (to the nearest whole number)?

NYNEX, the phone utility for the New York City area, has approached you for advice on its capital structure. In 1995, NYNEX had debt outstanding of $12.14 billion and equity outstanding of $1.7 billion and faced a corporate tax rate of 36%. The beta for the stock is 0.84, and the bonds are rated A - (with a market interest rate of 7.5%). The probability of default for A-rated bonds is 1.41%, and the bankruptcy cost is estimated to be 30% of the firm.

a) estimate the unlevered value of the firm

b)value the firm, if it increases its leverage to 50%. At that debt ratio, its bond rating would be BBB and the probability of default would be 2.30%.

c)Assume now that NYNEX is considering a move into entertainment, which is likely to be both more profitable and riskier than the phone business. What changes would you respect in the optimal leverage?

Question 1 Week 7 Jaguar Ltd purchased a machine on 1 July 2016 at the cost of $640,000. The machine is expected to have a useful life of 5 years (straight-line basis) and no residual value. For taxation purposes, the ATO allows the company to depreciate the asset over 4 years. The profit before tax for the company for the year ending 30 June 2017 is $600,000. To calculate this profit the company has deducted $60,000 entertainment expense, and $80,000 salary expense that has not yet been paid. Also the company has included $70,000 interest as income that the company has not yet received. The tax rate is 30%. Required: (a) Calculate the company’s taxable profit and hence its tax payable for 2017. (b) Determine the deferred tax liability and/or deferred tax asset that will result. (

Guard Inc., a calendar year C-Corporation, and accrual method taxpayer provide the following information to you and asks you to prepare a Schedule M-1. Complete the assignment using the actual Schedule M-1 form (for 1120 C-Corporation). Net Income per Book:                           $425,000

Tax Exempt Interest Income:                $260

Federal Income Tax Paid:                      $10,000

Life Insurance Proceeds:                       $100,000 - (received upon death of key employee – the President)

Excess Charitable Contribution             $3,000 (paid $20,000, was only able to deduct $17,000 on current year tax return)

MACRS Tax Depreciation                      $150,000 – depreciation taken on the tax return

Book Depreciation                               $20,000 – depreciation taken for book (financial statement)

Total Meals & Entertainment expense $5,000