A report announced that the mean sales price of all new houses sold one year was $272,000. Assume that the population standard deviation of the prices is $100,000. If you select a random sample of 100 new houses, what is the probability that the sample mean sales price will be between $250,000 and $285,000?

Select one:

a. 0.1388

b. 0.8034

c. 0.2956

d. 0.8893

Jurgen is taking ISOM2002 in the current semester and he suspects that there are not too many students in the course have submitted all the assigned work (online exercises and assignments). He claims that there is no more than 70% of the students have done it. He asked around 20 friends who are also studying ISOM2002 in the current semester, and 15 of them said they had submitted all the assigned work. Suppose Jurgen would like to use hypothesis testing to support his claim, what would be the type II error in his test?

Select one:

a. He concluded that there were less than 70% of all the students who had submitted all the assigned work but in fact the percentage was no less than 70%.

b. He concluded that there were no less than 70% of all the students who had submitted all the assigned work but in fact the percentage was less than 70%.

c. He concluded that there were no more than 70% of all the students who had submitted all the assigned work but in fact the percentage was more than 70%.

d. He concluded that there were more than 70% of all the students who had submitted all the assigned work but in fact the percentage was no more than 70%.

Which of the following is not a characteristic of a normal variable?

Select one:

a. It is a continuous random variable.

b. The probability of each individual value is virtually 0.

c. The mean and the median are always the same.

d. It assumes a countable number of values.

Robots in the factory and price rise for suppliers as Maleny Dairies invests

Accounting ethics cases

You have recently been hired as the assistant controller for Stanton Temperton Corporation, which rents building space in major metropolitan areas. Customers are required to pay six months of rent in advance. At the end of 2018, the company's president, Jim Temperton, notices that net income has fallen compared to last year. In 2017, the company reported before-tax profit of $330,000, but in 2018 the before-tax profit is only $280,000. This concerns Jim for two reasons. First, his year-end bonus is tied directly to before-tax profits. Second, shareholders may see a decline in profitability as a weakness in the company and begin to sell their stock. With the sell-off of stock, Jim's personal investment in the company's stock, as well as his company-operated retirement plan, will be in jeopardy of severe losses. After close inspection of the financial statements, Jim notices that the balance of the Deferred Revenue account is $120,000. This amount represents payments in advance from long-term customers ($80,000) and from relatively new customers ($40,000). Jim comes to you, the company's accountant, and suggests that the firm should recognize as revenue in 2018 the $80,000 received in advance from long-term customers. He offers the following explanation: “First, we have received these customers' cash by the end of 2018, so there is no question about their ability to pay. Second, we have a long-term history of fulfilling our obligation to these customers. We have always stood by our commitments to our customers and we always will. We earned that money when we got them to sign the sixmonth contract.”

1. Summarize your case.

2. What is the dilemma?

3. What is the ethical solution?

4. What would you do if you are faced with the dilemma?

Describe the four practices of the globalization project (outsourcing, displacement, informalization, recolonization) Who benefits from them? Who is disadvantaged?

GIVEN: 1,000,000 € (EUR, Euro) invest in US w/ current spot XR = US$ 1.18/€ and 3-month US APR = 2%

1- What is the expected EFFECTIVE Annual Return on the US investment:

2- Convert the Euros, determine the dollar amount after the three months, and translate the dollars back into Euros at a future SPOT rate of XR = US$ 1.12/€:

3-What did the investor earn in Euros for the three month period annualized on a simple interest basis:

4-What did the investor earn in Euros for the three month period annualized on a compound interest basis:

5-Which currency appreciated?

1. For each item below say (a) what the category in the BOP it falls under (i.e., export, FDI, unilateral transfer, etc.); (b) what account it goes in (CA, FA or OR); (c) whether it is a debit (-) or a credit (+) item. All for the US BOP. • US hospitals purchase ventilators manufactured in Canada. • Microsoft sends its European profits to its headquarters in the US. • Japanese firm Toyota builds a factory in California. • Swiss bank UBS buys shares on the New York Stock Exchange. • US provides military aid to Brazil. • The central bank of South Korea invests its dollar holdings in US Treasury securities.

Use the information in the table

1. What is the expected return of a portfolio with 25% of wealth invested in the US, and 75% invested in the UK?
2. What is the standard deviation of return of a portfolio with 25% of wealth invested in the US, and 75% invested in the UK?
3. What is the covariance of return between the US and the UK?
4. Can an investor obtain diversification gains by investing in both the US and the UK?  Why or why not?  Be sure to provide quantitative justification for your answer.

After 18 months of hard work, self-paced learning, and success at Salesforce, you have just been promoted from Associate Sales Representative to Account Executive. Your annual salary was increased by 11% overnight which will certainly help reduce some of the stress you have felt balancing student loan repayment with the costs of an exciting (but expensive) life in Chicago. You are backfilling Heather Lee, your onboarding mentor who was just promoted to her first sales manager role in Boston. Your territory includes a handful of existing clients and new business responsibility for pharmaceutical industry firms with at least $50M in annual revenues in the states of Illinois, Wisconsin, Michigan, Iowa, and Minnesota. One of the largest opportunities Heather handed over to you is a new customer relationship management (CRM) solution for Eli Lilly and Company headquartered in Indianapolis. Heather has been negotiating with the decision maker, Chief Revenue Officer Declan Macmanus, for several months.

The total purchase price of the integrated Salesforce Sales Cloud solution is $678,000 for 1,100 new tablet computers and cloud software plus $14,250 installation and training costs. It is expected that your solution will reduce the customer support cost of Lilly’s operation by $176,600 per year. The solution will have a life of 6 years. The tablet computers included in your solution can be resold at the end of the period for $295,500. Salesforce’s competitor in this opportunity at Lilly is Microsoft with their Dynamics CRM solution. The Microsoft sales team has presented a similar system which has a purchase price of $708,022, free installation costs, an annual reduction of the customer support cost of Lilly’s operation of $184,000 per year. The Microsoft solution is also expected to have a life of 6 years. The tablet computers included in this solution can be resold at the end of the period for $275,000. The account executive from Microsoft, Caroline Partum, has influenced Declan to believe that her higher initial price is justified by the incremental annual higher savings. Neither Salesforce nor Microsoft is offering financing as Lilly is expected to pay upfront for this solution. Mr. Macmanus can borrow from Lilly’s bank at a rate of 3.5%. He has asked you to use this cost-of-capital rate for any net present value calculations.

You have been asked to prepare a six year financial comparison of the two proposals. Specifically, all costs and benefits are to be provided in today’s dollar terms. Mr. Macmanus has indicated that he will quickly make his decision on that basis, as he perceives the systems are nearly identical. Which of the two proposals offers the best ROI (quantified in both $US dollars and %) for Lilly? How do the ROIs of the two proposals (quantified in both $US dollars and %) change for Lilly if Lilly’s cost-of-capital is only 2.9%?

8) For each of the following costs incurred at Brockton Hospital, indicate whether it would most
likely be a direct cost or an indirect cost of the specified cost object. (12 pts)
Cost   Cost Object Direct Cost/Indirect Cost
Example Catered food served to patients A particular patient Direct Cost direct cost
1 Wages of pediatric nurses Pediatric department ?
2 Heating the hospital Pediatric department ?
3 Salary of the head of pediatrics A particular pediatric patient ?
4. Lab tests by outside contractor A particular patient ?
5 Lab tests by outside contractor A particular department ?

9) The BSU Works assembles custom computers from components supplied by various
manufactures. The company is very small and its assembly shop and retail sales store are
housed in a single facility in Bridgewater, Mass. Listed below are some or the costs that are
incurred at the company. For each cost, indicate whether it would most likely be classified as
direct materials, direct labor, manufacturing overhead, selling, or an administrative cost. (10
pts)
A) The cost of a hard drive installed in a computer_______________________________.
B) The cost of advertising in the local newspaper________________________________.
C) The wages of the employees who assemble computers from components__________.
D) The salary of the assembly shop’s supervisor_________________________________.
E) The salary of the company’s accountant_____________________________________.

10) You have a summer job as an intern at Drones-R-Us, a company that manufactures spy cameras for remote controlled military drones. The company, which is privately owned, has approached a bank for a loan to help finance its growth. The back requires financial statements before approving the loan. You are tasked with classifying each cost listed as either a product cost or a period cost in order to prepare the FS for the bank. (10 pts)

Costs Product Cost or Period Cost

1 Depreciation on salespersons vehicles ?

2 The cost of packaging the company’s product ?

3 Lubricants used for machine maintenance ?

4 Factory supervisors salaries ?

5 Advertising costs ?

11) AG Corp uses a plantwide predetermined overhead rate of $22.70 per direct labor-hour. This POHR was based on a cost formula that estimated $272,400 of total manufacturing overhead cost for an estimated activity level of 12,000 direct labor-hours. The company incurred actual total manufacturing overhead cost of $267,000 and 11,600 total direct labor-hours during the period. Determine the amount of manufacturing overhead cost that would have been applied to all jobs during the period. (3 pts) Manufacturing overhead applied = $_______________

Formulas Y = a + bX Applied Overhead = POHR x Actual Direct Labor Hours POHR = Estimated total manufacturing overhead cost for the coming period / Estimated total units in the allocation base for the coming period

Frito-Lay's Quality-Controlled Potato Chips

Video Case

Frito-Lay, the multi-billion-dollar snack food giant, produces billions of pounds of product every year at its dozens of U.S. and Canadian plants. From the farming of potatoes—in Florida, North Carolina, and Michigan—to factory and to retail stores, the ingredients and final product of Lay’s chips, for example, are inspected at least 11 times: in the field, before unloading at the plant, after washing and peeling, at the sizing station, at the fryer, after seasoning, when bagged (for weight), at carton filling, in the warehouse, and as they are placed on the store shelf by Frito-Lay personnel. Similar inspections take place for its other famous products, including Cheetos, Fritos, Ruffles, and Tostitos.

In addition to these employee inspections, the firm uses proprietary vision systems to look for defective potato chips. Chips are pulled off the high-speed line and checked twice if the vision system senses them to be too brown.

The company follows the very strict standards of the American Institute of Baking (AIB), standards that are much tougher than those of the U.S. Food and Drug Administration. Two unannounced AIB site visits per year keep Frito-Lay’s plants on their toes. Scores, consistently in the “excellent” range, are posted, and every employee knows exactly how the plant is doing.

There are two key metrics in Frito-Lay’s continuous improvement quality program: (1) total customer complaints (measured on a complaints per million bag basis) and (2) hourly or daily statistical process control scores (for oil, moisture, seasoning, and salt content, for chip thickness, for fryer temperature, and for weight).

In the Florida plant, Angela McCormack, who holds engineering and MBA degrees, oversees a 15-member quality assurance staff. They watch all aspects of quality, including training employees on the factory floor, monitoring automated processing equipment, and developing and updating statistical process control (SPC) charts. The upper and lower control limits for one checkpoint, salt content in Lay’s chips, are 2.22% and 1.98%, respectively. To see exactly how these limits are created using SPC, watch the video that accompanies this case.

Discussion Questions

1. Angela is now going to evaluate a new salt process delivery system and wants to know if the upper and lower control limits at 3 standard deviations for the new system will meet the upper and lower control specifications noted earlier.

The data (in percents) from the initial trial samples are:

• Sample 1: 1.98, 2.11, 2.15, 2.06
• Sample 2: 1.99, 2.0, 2.08, 1.99
• Sample 3: 2.20, 2.10. 2.20, 2.05
• Sample 4: 2.18, 2.01, 2.23, 1.98
• Sample 5: 2.01, 2.08, 2.14, 2.16

Provide the report to Angela.

2. What are the advantages and disadvantages of Frito-Lay drivers stocking their customers’ shelves?

3.Why is quality a critical function at Frito-Lay?