On January 1, 2017, Loud Company enters into a 2-year contract with a customer for an unlimited talk and 5 GB data wireless plan for $65 per month. The contract includes a smartphone for which the customer pays $299. Loud also sells the smartphone and monthly service plan separately, charging $649 for the smartphone and $65 for the monthly service for the unlimited talk and 5 GB data wireless plan.
Required:
| 1. | Calculate the transaction price for the smartphone and unlimited talk and 5 GB data wireless plan assuming that Loud allocates consideration based on stand-alone prices. |
| 2. | Record the initial journal entry for Loud Company’s sale of a 2-year contract on January 1, 2017, and the monthly journal entry. |
In: Accounting
Assume all salaries are paid at the end of each year; evaluate the three options for peter
option 1. Stay in his current job
Annual salary $520,000 and his salary is expected to increase by 5.25% per year for 38 more years until retirement.
Peter's remuneration package includes base salary and medical and dental health care insurance plans. Assume individual income tax rate is 20%.
Option 2. Nanyang business school full-time MBA 1 yr plan
Tuition fee is $55,000, books and other supplies cost $1,200. Upon graduation, peter expects to receive offers with remuneration package that includes a base salary of $520,000 per year, signing bonus of $30,000 as well as medical and dental health care insurance. His salary will be increased by 7.25%. Individual tax rate is 20%.
Option 3. Singapore management university 1 yr plan
Tuition fee is $60,990, books and other supplies cost is $1,500. Upon graduation, peter expects to receive offers with a remuneration package that includes a base salary of $540,000 per year, signing bonus of $10,000 as well as medical and dental health care insurance plans. His salary will be increased by 7% per year. Assume individual income tax rate is 20%.
* Peter estimates that the living and miscellaneous expenses at both universities may cost $4,000 more. Assume the tuition fee as well as the additional living and miscellaneous expenses are payable at the beginning of each term and the discount rate is 8%.
In: Finance
A project requires an investment of $20,000 and will return $26,500 after one year. Suppose the 10-year Treasury bill rate is 5%, and the project has a risk premium of 12%.
A) Should this project be taken? Also Calculate the IRR of this project.
B)If the manager wants to finance the project solely with equity, what is the equity holder’s valuation of this project?
C)If the manager wants to finance the project 50% with equity and 50% with 10-year T-bill, what is equity holder’s valuation of this project?
D)Explain in your own words why the equity holder’s valuation of the project differs between B) and C).
E)Using the information of this project, draw a graph illustrating the relation between cost of levered equity and the leverage ratio [D/ (D+E)]
Please Help!
In: Finance
The following information pertains to the City of Williamson for 2017, its first year of legal existence. For convenience, assume that all transactions are for the general fund, which has three separate functions: general government, public safety, and health and sanitation.
| Receipts: | |
| Property taxes | $320,000 |
| Franchise taxes | 42,000 |
| Charges for general government services | 5,000 |
| Charges for public safety services | 3,000 |
| Charges for health and sanitation services | 42,000 |
| Issued long-term note payable | 200,000 |
| Receivables at end of year: | |
| Property taxes (90% estimated to be collectible) | 90,000 |
| Payments: | |
| Salary: | |
| General government | 66,000 |
| Public safety | 39,000 |
| Health and sanitation | 22,000 |
| Rent: | |
| General government | 11,000 |
| Public safety | 18,000 |
| Health and sanitation | 3,000 |
| Maintenance: | |
| General government | 21,000 |
| Public safety | 5,000 |
| Health and sanitation | 9,000 |
| Insurance: | |
| General government | 8,000 |
| Public safety ($2,000 still prepaid at end of year) | 11,000 |
| Health and sanitation | 12,000 |
| Interest on debt | 16,000 |
| Principal payment on debt | 4,000 |
| Storage shed | 120,000 |
| Equipment | 80,000 |
| Supplies (20% still held) (public safety) | 15,000 |
| Investments | 90,000 |
| Ordered but not received: | |
| Equipment | 12,000 |
| Due in one month at end of year: | |
| Salaries: | |
| General government | 4,000 |
| Public safety | 7,000 |
| Health and sanitation | 8,000 |
Compensated absences (such as vacations and sick days) legally owed to general government workers at year-end total $13,000. These amounts will not be taken by the employees until so late in 2018 that the payment is not viewed as requiring 2017 current financial resources.
The city received a piece of art this year as a donation. It is valued at $14,000. It will be used for general government purposes. There are no eligibility requirements. The city chose not to capitalize this property.
The general government uses the storage shed that was acquired this year. It is being depreciated over 10 years using the straight-line method with no salvage value. The city uses the equipment for health and sanitation and depreciates it using the straight-line method over five years with no salvage value.
The investments are valued at $103,000 at the end of the year.
For the equipment that has been ordered but not yet received, the City Council (the highest decision-making body in the government) has voted to honor the commitment when the equipment is received.
b-2. Prepare a balance sheet for the general fund as of December 31, 2017. Assume that the city applies the consumption method.
In: Accounting
The following information pertains to the City of Williamson for 2017, its first year of legal existence. For convenience, assume that all transactions are for the general fund, which has three separate functions: general government, public safety, and health and sanitation.
| Receipts: | |
| Property taxes | $320,000 |
| Franchise taxes | 42,000 |
| Charges for general government services | 5,000 |
| Charges for public safety services | 3,000 |
| Charges for health and sanitation services | 42,000 |
| Issued long-term note payable | 200,000 |
| Receivables at end of year: | |
| Property taxes (90% estimated to be collectible) | 90,000 |
| Payments: | |
| Salary: | |
| General government | 66,000 |
| Public safety | 39,000 |
| Health and sanitation | 22,000 |
| Rent: | |
| General government | 11,000 |
| Public safety | 18,000 |
| Health and sanitation | 3,000 |
| Maintenance: | |
| General government | 21,000 |
| Public safety | 5,000 |
| Health and sanitation | 9,000 |
| Insurance: | |
| General government | 8,000 |
| Public safety ($2,000 still prepaid at end of year) | 11,000 |
| Health and sanitation | 12,000 |
| Interest on debt | 16,000 |
| Principal payment on debt | 4,000 |
| Storage shed | 120,000 |
| Equipment | 80,000 |
| Supplies (20% still held) (public safety) | 15,000 |
| Investments | 90,000 |
| Ordered but not received: | |
| Equipment | 12,000 |
| Due in one month at end of year: | |
| Salaries: | |
| General government | 4,000 |
| Public safety | 7,000 |
| Health and sanitation | 8,000 |
Compensated absences (such as vacations and sick days) legally owed to general government workers at year-end total $13,000. These amounts will not be taken by the employees until so late in 2018 that the payment is not viewed as requiring 2017 current financial resources.
The city received a piece of art this year as a donation. It is valued at $14,000. It will be used for general government purposes. There are no eligibility requirements. The city chose not to capitalize this property.
The general government uses the storage shed that was acquired this year. It is being depreciated over 10 years using the straight-line method with no salvage value. The city uses the equipment for health and sanitation and depreciates it using the straight-line method over five years with no salvage value.
The investments are valued at $103,000 at the end of the year.
For the equipment that has been ordered but not yet received, the City Council (the highest decision-making body in the government) has voted to honor the commitment when the equipment is received.
a-2. Prepare a statement of net position for governmental activities for December 31, 2017.
In: Accounting
On January 1 of the current year, Herkimer & Co. purchases, a group of 6 laptops for its new hires. The laptops are purchased for $2,200 each with a residual value of $400 each. Herkimer expects the laptops to be used for 3 years. At the end of the current year, Herkimer & Co. sells two laptops for $1,900 each.
Required:
| Prepare the journal entries to record the purchase of the laptops, the depreciation on the laptops, and the sale of the laptops in Year 1. |
In: Accounting
*As an employee with less than one year of experience in a firm,
what actions would you pursue if you encountered unethical
practices by a strategic leader?
*Select an organization, social group, or volunteer agency of which
you are a member that you believe has an ethical culture. What
factors caused this culture to be ethical? Are there any events
that would cause the culture to become less ethical? If so, what
are they?
*Do firms encounter ethical issues when they use internal
corporate-venturing processes to produce and manage innovation? If
so, what are these issues?
*Small firms often have innovative products. When is it appropriate
for a large firm to buy a small firm for its product innovations
and new product ideas?
In: Operations Management
Last year, 46% of business owners gave a holiday gift to their employees. A survey of business owners indicated that 30% plan to provide a holiday gift to their employees. Suppose the survey results are based on a sample of 60 business owners.
| (a) | How many business owners in the survey plan to provide a holiday gift to their employees? |
| (b) | Suppose the business owners in the sample do as they plan. Compute the p value for a hypothesis test that can be used to determine if the proportion of business owners providing holiday gifts has decreased from last year. If required, round your answer to four decimal places. If your answer is zero, enter “0”. Do not round your intermediate calculations. |
| (c) | Using a 0.05 level of significance, would you conclude that the proportion of business owners providing gifts has decreased? |
| We - Select your answer to the null hypothesis. We - Select your answer conclude that the proportion of business owners providing gifts has decreased from 2008 to 2009. | |
| What is the smallest level of significance for which you could draw such a conclusion? If required, round your answer to four decimal places. If your answer is zero, enter “0”. Do not round your intermediate calculations. | |
| The smallest level of significance for which we could draw this conclusion is ; because p-value - Select your answer - α=0.05, we - Select your answer the null hypothesis. |
In: Statistics and Probability
The average number of pounds of meat that a person consumes per year is 218.4 pounds. Assume that the standard deviation is 25 pounds and the distribution is approximately normal.
a) Find the probability that a person selected at random consumes less than 224 pounds of meat per year. Calculate the z-score manually, and use StatCrunch or the Standard Normal Table to calculate the probability, rounding to four decimal places. (4 points)
b) If a sample of 40 individuals were selected randomly, find the probability that the mean of the sample will be less than 224 pounds per year. Calculate the z-score manually, and use StatCrunch or the Standard Normal Table to calculate the probability, rounded to four decimal places. (4 points)
c) Why are the probabilities in parts (a) and (b) so different? (2 points)
In: Statistics and Probability
2. Sportz Corporation is preparing its budget for the second quarter of the calendar year. The following monthly sales data (in units) have been forecasted:
| April | 45,000 |
| May | 48,000 |
| June | 54,000 |
| July | 60,000 |
| August | 75,000 |
Additional information:
• Desired ending inventory each month—Finished goods: 25% of next
month's sales.
• Desired ending inventory each month—Raw materials: 20% of next
month's production needs
• Number of raw material units required per unit of finished
product: 5 @ $4
Required:
Prepare a production budget, a direct material usage and purchases budget for the second quarter of the calendar year.
In: Accounting