The units of an item available for sale during the year were as follows:

There are 1,100 units of the item in the physical inventory at December 31. The periodic inventory system is used.

a. Determine the inventory cost by the first-in, first-out method.
$fill in the blank 1

b. Determine the inventory cost by the last-in, first-out method.
$fill in the blank 2

c. Determine the inventory cost by the weighted average cost method.
$fill in the blank 3

Bruce and Amanda are married during the tax year. Bruce is a botanist at Green Corporation. Bruce earns a salary of $70,000 per year.

Amanda owns an accounting practice as a sole proprietor (it qualifies as a full trade or business). Amanda generates $100,000 of revenues during the year. She has the following business payments associated with her firm:

• Utilities: $2,000
• Office Rent: $15,000
• Self-Employment Tax (hers): $10,000
• Salary for her secretary: $25,000
• Fines/Penalties: $2,500
• State Income Tax (from business): $6,000
• Payroll Taxes (secretary’s): $2,000
• Meals: $1,200
• Payment to officer to let her go from speeding while on her way to a client meeting $100

They also have the following personal expenses during the year:

·      Medical Expenses: $15,500

·      State & Local Taxes (personal): $11,000

·      Federal Income Tax Payments (personal): $10,000

·      Cash Charitable Contributions: $20,000

The standard deduction amounts are listed below:

·      Single: $12,200

·      Head of Household: $18,350

·      Married Filing Jointly: $24,400

Calculate the appropriate amounts for Bruce and Amanda on the following page. Please show your work for maximum points.

The following information applies to the questions displayed below.]

This year, Leron and Sheena sold their home for$1,372,500 after all selling costs. Under the following scenarios, how much taxable gain does the home sale generate for Leron and Sheena? (Leave no answer blank. Enter zero if applicable.)

a. Leron and Sheena bought the home three years ago for $225,000 and lived in the home until it sold.

b. Leron and Sheena bought the home one year ago for $1,125,000 and lived in the home until it sold.

c. Leron and Sheena bought the home five years ago for $877,500. They lived in the home for three years until they decided to buy a smaller home. Their home has been vacant for the past two years.

Periodic Inventory by Three Methods

The units of an item available for sale during the year were as follows:

There are 14 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to one decimal and final answers to the nearest whole dollar, if required.

a. Determine the inventory cost by the first-in, first-out method.
$fill in the blank 1

b. Determine the inventory cost by the last-in, first-out method.
$fill in the blank 2

c. Determine the inventory cost by the weighted average cost method.
$fill in the blank 3

Shan Co. is considering a four-year project that will require an initial investment of $15,000. The base-case cash flows for this project are projected to be $12,000 per year. The best-case cash flows are projected to be $19,000 per year, and the worst-case cash flows are projected to be –$3,000 per year. The company’s analysts have estimated that there is a 50% probability that the project will generate the base-case cash flows. The analysts also think that there is a 25% probability of the project generating the best-case cash flows and a 25% probability of the project generating the worst-case cash flows.

What would be the expected net present value (NPV) of this project if the project’s cost of capital is 11%?

$16,825

$18,428

$16,024

$12,819

Shan now wants to take into account its ability to abandon the project at the end of year 2 if the project ends up generating the worst-case scenario cash flows. If it decides to abandon the project at the end of year 2, the company will receive a one-time net cash inflow of $3,000 (at the end of year 2). The $3,000 the company receives at the end of year 2 is the difference between the cash the company receives from selling off the project’s assets and the company’s –$3,000 cash outflow from operations. Additionally, if it abandons the project, the company will have no cash flows in years 3 and 4 of the project.

Using the information in the preceding problem, find the expected NPV of this project when taking the abandonment option into account.

$22,855

$21,027

$18,284

$16,456

What is the value of the option to abandon the project?     

1808

2034

1695

2486

2260

Marketing is requesting a 1,000,000 pcs/year volume and the life expectancy for this part is 5 years. Estimated part weight is 1.750 kg.

1. What will be the weekly required production rate to meet the yearly volume?
2. How many cavities are recommended for the production yearly volume required?
3. Based on your previous answer, how many normal hours and overtime hours will be required to meet the weekly production schedule.
4. Determine the piece price the first year considering the initial investment amortized on the first year of production and a 25 % gross profit.

Useful data:

Mr. “O” reported :$100,000 USD development cost.

Mr. “CASIO” reported:              MOLD: $350,000 USD for 1 Cav.

&    $550,000 for 2 cav. mold

                                       Checking fixture: $60,000 USD

                                       Secondary Equipment :$25,000 USD

Mr. “NICASIO” reported:

             Cycle time : 50 seconds

             Machine utilization cost : 3000 USD/hour

             Material Cost: $4.50 USD/LB.

             Labor Cost Normal time: 20 USD/hour

             Labor Cost overtime : 40 USD/hour

             SG&A cost : 20 USD/hour

WORK HOURS: NORMAL TIME: 3 SHIFTS OF 8 HOURS

WEEKENDS ARE OVERTIME

52 WEEKS PER YEAR.

(All of the info give so assume for the current tax year ? )

Trey claims a dependency exemption for both of his daughters, ages 14 and 17, at year-end. Trey files a joint return with his wife.

What amount of child credit will Trey be able to claim for his daughters under each of the following alternative situations?

a. His AGI is $102,700.

b. His AGI is $123,700.

c. His AGI is $131,800, and his daughters are ages 10 and 12.

.

Taxable amount of eligible dividends: $8,280

Capital gains: $4,000

Other investment income: $2,000

On January 1 of this year, Victor Corporation sold bonds with a face value of $1,560,000 and a coupon rate of 10 percent. The bonds mature in four years and pay interest semiannually every June 30 and December 31. Victor uses the straight-line amortization method and also uses a premium account. Assume an annual market rate of interest of 8 percent.

1. Prepare the journal entry to record the issuance of the bonds.

2. Prepare the journal entry to record the interest payment on June 30 of this year.

3. What bonds payable amount will Victor report on its June 30 balance sheet?

Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $93 per unit, and variable expenses are $63 per unit. Fixed expenses are $838,500 per year. The present annual sales volume (at the $93 selling price) is 25,800 units.

Required:

1. What is the present yearly net operating income or loss?

2. What is the present break-even point in unit sales and in dollar sales? (Do not round intermediate calculations.)

  3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit?

4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)? (Do not round intermediate calculations.)