Transplant operations have become routine. One common transplant operation is for kidneys. The most dangerous aspect of the procedure is the possibility that the body may reject the new organ. There are several new drugs available for such circumstances and the earlier the drug is administered, the higher the probability of averting rejection. The New England Journal of Medicine recently reported the development of a new urine test to detect early warning signs that the body is rejecting a transplanted kidney. However, like most other tests, the new test is not perfect. In fact, 20% of negative tests and 5% of positive tests prove to be incorrect. Physicians know that in about 31% of kidney transplants the body tries to reject the organ. If the new test has a positive result (indicating early warning of rejection), what is the probability that the body is attempting to reject the kidney?

Transplant operations have become routine. One common transplant operation is for kidneys. The most dangerous aspect of the procedure is the possibility that the body may reject the new organ. There are several new drugs available for such circumstances and the earlier the drug is administered, the higher the probability of averting rejection. The New England Journal of Medicine recently reported the development of a new urine test to detect early warning signs that the body is rejecting a transplanted kidney. However, like most other tests, the new test is not perfect. In fact, 20% of negative tests and 9% of positive tests prove to be incorrect. Physicians know that in about 32% of kidney transplants the body tries to reject the organ. If the new test has a positive result (indicating early warning of rejection), what is the probability that the body is attempting to reject the kidney?

Your client was born in Australia but lived in New Zealand for a long period of time. He came to New Zealand for a holiday after finishing university, met up with his former spouse and set up home here. He worked as a police officer in New Zealand. Since separating from his spouse, he moved back to Australia in July 2018 and works as a security contractor in Australia. He maintains a bank account in Australia in which his salary is deposited and receives interest income on a term deposit. He also holds shares in Australian companies and receives dividends. Although he lives in Australia most of the year, he comes to New Zealand frequently to visit his former spouse and his children and lives with them while in New Zealand. He maintains a bank account and owns an investment property in New Zealand.

Required:

Explain with reasons whether your client is a tax resident of New Zealand and whether his contractor income, interest and dividend income from Australia will be taxable in New Zealand. Support your answer with references to the Income Tax Act 2007 and appropriate case law.

Your client was born in Australia but lived in New Zealand for a long period of time. He came to New Zealand for a holiday after finishing university, met up with his former spouse and set up home here. He worked as a police officer in New Zealand. Since separating from his spouse, he moved back to Australia in July 2018 and works as a security contractor in Australia. He maintains a bank account in Australia in which his salary is deposited and receives interest income on a term deposit. He also holds shares in Australian companies and receives dividends. Although he lives in Australia most of the year, he comes to New Zealand frequently to visit his former spouse and his children and lives with them while in New Zealand. He maintains a bank account and owns an investment property in New Zealand

.Explain with reasons whether your client is a tax resident of New Zealand and whether his contractor income, interest and dividend income from Australia will be taxable in New Zealand. Support your answer with references to the Income Tax Act 2007 and appropriate case law.

Situational Software Co. (SSC) is trying to establish its optimal capital structure. Its current capital structure consists of 40% debt and 60% equity; however, the CEO believes that the firm should use more debt. The risk-free rate, r_RF, is 5%; the market risk premium, RP_M, is 6%; and the firm's tax rate is 40%. Currently, SSC's cost of equity is 15%, which is determined by the CAPM. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below.

Open spreadsheet

What would be SSC's estimated cost of equity if it changed its capital structure to 50% debt and 50% equity? Round your answer to two decimal places. Do not round intermediate steps.

%

A new product is being evaluated. Market research has surveyed the potential market for this product and believes that it will generate a total demand of 50,000 units at average price of $280. Total sots for the various value-chain functions using existing process technology are:

Management has a target profit percentage of 40% of sales. Production engineering indicates that a new process technology can reduce the manufacturing cost by 40% but it will cost $150,000.

1. Assuming the existing process technology is used, should the new product be releases to production?

The unit target cost is $X. The expected average unit cost if the new product is release to production would be $X. The new product Should/Should not be released to production because the expected average unity cost is greater than/less than the unit target cost.

2. Assuming the new process technology is purchased, should the new product be released to production?

First calculate the total cost savings if the new process technology is purchased.

The total cost savings will be $X.

If the new process technology is purchased, the expected average unity cost will be $X. The new product should/should not be released to production because the expected average unit cost is greater than/less than the unit target cost.

The input is broken into chunks of consecutive lines, where each pair of consecutive chunks is separated by a line containing "----snip----". Read the entire input and break it into chunks C1,…,Ck. Then output the chunks in reverse order Ck,…,C1 but preserving the order of the lines within each chunk.

import java.io.BufferedReader;
import java.io.FileReader;
import java.io.FileWriter;
import java.io.IOException;
import java.io.InputStreamReader;
import java.io.PrintWriter;

public class Part7 {
   
   /**
    * Your code goes here - see Part0 for an example
    * @param r the reader to read from
    * @param w the writer to write to
    * @throws IOException
    */
   public static void doIt(BufferedReader r, PrintWriter w) throws IOException {
      // Your code goes here - see Part0 for an example
   }

   /**
    * The driver.  Open a BufferedReader and a PrintWriter, either from System.in
    * and System.out or from filenames specified on the command line, then call doIt.
    * @param args
    */
   public static void main(String[] args) {
      try {
         BufferedReader r;
         PrintWriter w;
         if (args.length == 0) {
            r = new BufferedReader(new InputStreamReader(System.in));
            w = new PrintWriter(System.out);
         } else if (args.length == 1) {
            r = new BufferedReader(new FileReader(args[0]));
            w = new PrintWriter(System.out);            
         } else {
            r = new BufferedReader(new FileReader(args[0]));
            w = new PrintWriter(new FileWriter(args[1]));
         }
         long start = System.nanoTime();
         doIt(r, w);
         w.flush();
         long stop = System.nanoTime();
         System.out.println("Execution time: " + 1e-9 * (stop-start));
      } catch (IOException e) {
         System.err.println(e);
         System.exit(-1);
      }
   }
}

Expand Your Critical Thinking 7-1

Aurora Company is considering the purchase of a new machine. The invoice price of the machine is $115,000, freight charges are estimated to be $3,000, and installation costs are expected to be $5,000. Salvage value of the new equipment is expected to be zero after a useful life of 5 years. Existing equipment could be retained and used for an additional 5 years if the new machine is not purchased. At that time, the salvage value of the equipment would be zero. If the new machine is purchased now, the existing machine would have to be scrapped. Aurora’s accountant, Lisah Huang, has accumulated the following data regarding annual sales and expenses with and without the new machine.

Prepare an incremental analysis for the 5 years. (Ignore income tax effects.) (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Should Aurora keep the existing machine or buy the new machine?