The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

If education increases by four years, what is the effect on the estimated probability of smoking?

The probability of smoking increases by .116 (or 11.6 percentage points)

The probability of smoking decreases by .116 (or 11.6 percentage points)

The probability of smoking decreases by 11.6 (or 11.6 percentage points)

The probability of smoking decreases by .413 (or 41.3 percentage points)

The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

At what point does another year of age reduce the probability of smoking?

19

21.93

38.46

51.62

The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

Interpret the coefficient of the binary variable “restaurn”

A person who lives in a state with restaurant smoking restrictions has a probability of smoking 10.1 percentage points lower than somebody living in a state without restaurant smoking restrictions

A person who lives in a state with restaurant smoking restrictions has a probability of smoking 10.1 percentage points higher than somebody living in a state without restaurant smoking restrictions

A person who lives in a state with restaurant smoking restrictions has a probability of smoking .101 percentage points lower than somebody living in a state without restaurant smoking restrictions

A person who lives in a state with restaurant smoking restrictions has a probability of smoking 1.01 percentage points lower than somebody living in a state without restaurant smoking restrictions

The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

Person number 206 in the datset has cigpric = 67.44, income = 6500, educ =16, age =77, restaurn = 0 and white = 0. What is the predicted probability of smoking?

.12

.65

.053

.0052

The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

What is the interpretation of the coefficient for log(cigpric)?

If cigarette prices go up 1% then the probability of smoking decreases by .00069 (or .069 percentage points)

If cigarette prices go up 1% then the probability of smoking increases by .00069 (or .069 percentage points)

If cigarette prices go up 1% then the probability of smoking decreases by .69 (or 6.9 percentage points)

If cigarette prices go up 1% then the probability of smoking decreases by 6.9 (or 69 percentage points)

The variable smokes is a binary variable equal to one if a person smokes and zero otherwise. Cigprice is the price of cigarettes, white is a dummy variable that takes the value 1 if the person is white and 0 otherwise and restaurn is a dummy that takes the value 1 if the person lives in a state with restaurant smoking restrictions.

The estimated linear probability model is

smokes = .656 - .069 log(cigpric) + .012 log(income) - .029 educ + .02 age - .00026 age^2 - .101 restaurn - .026 white

What is the interpretation of the coefficient for log(income)?

If income goes up 1% then the probability of smoking increases by .12 (or 12 percentage points)

If income goes up 1% then the probability of smoking decreases by .00012 (or .012 percentage points)

If income goes up 1% then the probability of smoking increases by .00012 (or .012 percentage points)

If income goes up 1% then the probability of smoking increases by 1.2 (or 12 percentage points)

Goodfood is a supermarket chain. During the current year it started building a new store. The directors are aware that in accordance with IAS23 Borrowing costs certain borrowing costs have to be capitalised.

Details relating to the construction of Goodfood’s new store:

Goodfood took out a €10 million loan with an interest rate of 7.5% per annum on 1 April 2017. The loan was specifically taken to finance the building of the new store which meets the definition of a qualifying asset in IAS23. Construction of the store started on 1 May 2017 and it was completed and ready for use on 28 February 2018.

Questions:

Goodfood’s new store meets the definition of a qualifying asset in IAS23. Which of the following describes a qualifying asset?

Group of answer choices

An asset that takes a substantial period of time to get ready for use or sale

A non-current asset that is classified as held-for-sale

An asset that is intended for use rather than sale

An asset that is ready for use or sale when purchased

Rather than take out a loan specifically for the new store Goodfood could have funded the store from existing borrowings which are:

• 10% bank loan of €50 million
• 8% bank loan of €30 million

In this case it would have applied a capitalisation rate to the expenditure on the asset. What would that rate have been?

Group of answer choices

9.25%

10%

9%

8.75%

What is the total of the finance costs which can be capitalized in respect of Goodfood’s new store?

Group of answer choices

€625,000

€750,000

€600,000

€500,000

Goodfood issued a loan on 1 April 2017. Three events or transactions must be taking place for capitalisation of borrowing costs to commence. Which one is NOT one of these?

Group of answer choices

Physical construction of the asset is nearing completion

Necessary activities are in progress to prepare the asset for use or sale

Borrowing costs are being incurred

Expenditure on the asset is being incurred

For this homework assignment, we present two ideal scenarios. Scenario #1: After graduation from high school, students begin jobs as construction workers and elementary school teachers. They expect their wages to remain relatively level throughout their careers. They marry five years after graduation from high school and raise large families with home schooling by the parents. Before marriage, both men and women work; once couples begin home schooling their children, one parent stays home, either the father or the mother. Scenario #2: After high school, students start pre-medical programs at college. They expect four years of college and four years of medical school, with costs of $40,000 a year. The students’ parents have no extra money, so the students borrow the tuition costs. After medical schools, they work for ten years as surgeons and medical specialists, then have one child that is sent to day care one year after birth and eventually to public school. Both parents work full time. In each scenario, what is the expected progression of income? For each career, what is the expected ratio of future income to current income (older construction worker vs young construction worker; surgeon vs college student). What is the likelihood of working with home schooled families vs one child in public school or day care? In each scenario, what is the expected progression of expenses? Consider current education costs and future costs of raising a family. In Scenario #1, why are expenses low before marriage and high after marriage? In Scenario #2, why are expenses high during college and medical school and low afterwards? In each scenario, do recent high school graduates save for future expenses or borrow from future income? Assume that all the students are good risks and we need not worry about defaults on loans. In which scenario is the real interest rate higher?

Francon Construction Inc, is an international company situated in Quebec City and uses IFRS. It is engaged in the construction of very high scale buildings in many countries for commercial and residential uses. On January 1, 2011, it issued 15-year redeemable bonds. These bonds could be redeemed at any time five years following the date of issue, at the option of the company. If these bonds were to be redeemed earlier than their maturity date, the company would have to pay a redemption premium of 3% of the face value of the bonds redeemed (ie: at 103). Interest was paid annually on December 31.

The company showed a credit unamortized balance (ie: book value) of $777,507.12 in the Bonds Payable account on December 31, 2014. On December 31, 2015, the company prepared the following journal entry related to this bond issue:

      Interest Expense                                       $69,975.64

            Cash                                                                    $63,000.00

            Bonds Payable                                                    $ 6,975.64

On January 1, 2016, the company redeemed all the outstanding bonds. The cash payment was equal to the unamortized balance of the bonds plus a redemption premium of $27,000.

Required:

1.   With the information given above, determine

      a]   The coupon rate of the bond;

      b]   The effective rate of the bonds;

      c]   The face value of the bonds.

2.   Prepare the journal entry required to record the redemption of the bonds.

3.   Show in good format, how the company would report the bonds on their balance sheet on December 31, 2015.

4.   For this part only, now assume that the above redemption of bonds by Francon Construction Inc. did not occur and that the bonds have a face value (and book value) of $800,000 due on June 30, 2026. On March 30, 2026, it issued $600,000 in common shares and used the proceeds of this against the total payment required on June 30, 2026. The financial statements for the year ended December 31, 2025 were released on April 10, 2026.

       How would they classify the bond payable on the December 31, 2025 statement of financial position if they used:

            -IFRS?

            -ASPE?

You have been provided with accounting research tools. Use them to answer the following multiple choice questions. After you make your choice, tell me what theory you are basing your answer on, or what part of the codification applies to the question.

2. During the year just ended, Lawrence Co. incurred $20,000 of costs to repair Machine A. These expenditures improved the quality and quantity of output but did not extend the useful life. Lawrence also spent $1,000 to replace a small part on Machine B and $12,000 for regular monthly repairs of all the machines in the plant. The amount of the foregoing expenditures that should be reported as repair and maintenance expense is

A) $33,000

B) $21,000

C) $13,000

D) $12,000

3. Testing for possible impairment of a long-lived asset (asset group) that an entity expects to hold and use is required

A) At each interim and annual balance sheet date.

B) At annual balance sheet dates only.

C) Periodically.

D) Whenever events or changes in circumstances indicate that its carrying amount may not be recoverable.

4. On January 2 of the current year, BC Co. acquired 1,000 shares of its $10 par value common stock for $20,000. On July 1, BC exchanged this stock for land to be held for use as the site of the corporate headquarters. The stock had a fair value of $25 per share on that date. The building on the site was razed, and BC sold the scrap for $2,000. At what amount should the land be capitalized?

A) $25,000

B) $23,000

C) $20,000

D) $18,000

5. SPUR Co. is constructing a supertanker for sale to a foreign country as a discrete project. In which case should the company cease capitalizing interest on the project?

A) Expenditures have exceeded the budgeted costs.

B) Construction has been completed.

C) Construction on the project has been temporarily suspended.

D) The construction loan will be paid with proceeds of a working capital loan.

1. A state’s Division of Motor Vehicles (DMV) claims that 60% of all teens pass their driving test on the
first attempt. An investigative reporter examines an SRS of the DMV records for 125 teens; 56 of them
passed the test on their first try. Is there convincing evidence at the α=0.01 significance level that the
DMV’s claim is lower?

2. In a recent year, 65% of first-year college students responding to a national survey identified “being
very well-off financially” as an important personal goal. A state university finds that 102 of an SRS of
200 of its first-year students say that this goal is important. Is there convincing evidence at
the α=0.05 significance level that the proportion of all first-year students at this university who think
being very well-off is important differs from the national value of 65%?

3. Every road has one at some point—construction zones that have much lower speed limits. To see if
drivers obey these lower speed limits, a police officer uses a radar gun to measure the speed (in miles
per hour, or mph) of a random sample of 10 drivers in a 25 mph construction zone. Here are the data:
27 33 32 21 30 30 29 25 27 34
Is there convincing evidence at the α=0.01 significance level that the average speed of drivers in this
construction zone is greater than the posted speed limit?

4. A school librarian purchases a novel for her library. The publisher claims that the book is written at a fifth-grade reading level, but the librarian suspects that the reading level is lower than that. The librarian selects a random sample of 45 pages and uses a standard readability test to assess the reading level of each page. The mean reading level of these pages is 4.8 with a standard deviation of 0.6. Do these data give convincing evidence at the α=0.01 significance level that the average reading level of this novel is less than 5?

I need an answer only for the bold part of the question.

1. Circle:

The class has two private instance variables: radius (of the type double) and color (of the type String).

The class also has a private static variable: numOfCircles (of the type long) which at all times will keep track of the number of Circle objects that were instantiated.

Construction:

A constructor that constructs a circle with the given color and sets the radius to a default value of 1.0.

A constructor that constructs a circle with the given, radius and color.

Once constructed, the value of the radius must be immutable (cannot be allowed to be modified)

Behaviors:

Accessor and Mutator aka Getter and Setter for the color attribute

Accessor for the radius.

getArea() and getCircumference() methods, hat return the area and circumference of this Circle in double.

Hint: use Math.PI (https://docs.oracle.com/javase/8/docs/api/java/lang/Math.html#PI (Links to an external site.))

2. Rectangle:

The class has two private instance variables: width and height (of the type double)

The class also has a private static variable: numOfRectangles (of the type long) which at all times will keep track of the number of Rectangle objects that were instantiated.

Construction:

A constructor that constructs a Rectangle with the given width and height.

A default constructor.

Behaviors:

Accessor and Mutator aka Getter and Setter for both member variables.

getArea() and getCircumference() methods, that return the area and circumference of this Rectangle in double.

a boolean method isSquare(), that returns true is this Rectangle is a square.

Hint: read the first 10 pages of Chapter 5 in your text.

3. Container

The class has two private instance variables: rectangle of type Rectangle and circle of type Circle.

Construction:

No explicit constructors.

Behaviors:

Accessor and Mutator aka Getter and Setter for both member variables.

an integer method size(), that returns 0, if all member variables are null, 1 either of the two member variables contains a value other than null, and 2, if both, the rectangle and circle contain values other than null.

Suppose we wish to build a multiple regression model to predict the cost of rent (dollars) in a city based on population (thousands of people), and income (thousands of dollars). Use the alpha level of 0.05.

A. Is the whole regression model effective in predicting the cost of rent? Use alpha of 0.1. Make sure to show which values you use to make the decision.

B. Write down the multiple regression equation using actual names of IVs and DVs.

C. What is the value of the estimated intercept? Interpret the value in terms of rent (dollars) based on population (thousands of people), and income (thousands of dollars).

D. What is the values of the estimated slope for the variable “Income”? Interpret the value in terms of actual names of IVs and the DV.

E. What is the values of the estimated slope for the variable “Population”? Interpret the value in terms of actual names of IVs and the DV.

F. Does Income significantly influence the Rent at the alpha level of 0.01? Make sure to show which values you use to make the decision.

G. Does Population significantly influence the Rent at the alpha level of 0.01? Make sure to show which values you use to make the decision.

Data:

Jenny Jinglebell has always wished to own her own French macaroons shop. Ever since she tried

her first macaroon, she thought it would be a brilliant idea to have her own shop where she can

sell a multitude of flavors and colors of French macaroons. She purchased a premium site for

the macaroons shop, right across the street from Campus Martius Park in Downtown Detroit.

After extensive research, Jenny decided that it is best for her to open a franchise at first. The

franchise that best fit Jenny’s criteria is François Patisserie. A François Patisserie franchise costs

$30,000, an amount that is amortized over 15 years. As a franchisee, Jenny needs to adhere to

the company’s building specifications. The building would cost an estimated $450,000 and

would result in a $50,000 salvage value at the end of its 15-year life. The equipment needed is

sold as a package by the corporate office at a cost of $200,000, will have a salvage value of

$10,000 at the end of its 5-year life, equipment and must be replaced every 5 years.

Jenny estimates the annual revenue from a François Patisserie franchise at $950,000. Food

costs typically run 36% of revenue. Annual operating expenses, not including depreciation, total

$425,000. For financial reporting purposes, Jenny will use straight-line depreciation and

amortization. Based on past experience, she uses a 16% discount rate.

*Please no handwriting*

Required:

a.

Calculate the shop’s net present value over the franchise’s 15-year life.

b.

Calculate the restaurant’s payback period.

c.

Calculate the restaurant’s simple rate of return.

d.

Should Jenny open a

François Patisserie? Why or why not? Note: for comparison

purposes, you should know that

using Excel or a similar spreadsheet application Jenny

calculates her IRR to be 22.64%.

e.

What potential shortcomings do you see in Jenny’s estimates? How do you recommend she

adjusts her analysis to address those shortcomings?

Required information

eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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8.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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9.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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10.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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11.

value:
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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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12.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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13.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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14.

value:
10.00 points

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eBook & Resources

eBook: Compute activity rates for an activity-based costing system.eBook: Compute product costs using activity-based costing.eBook: Contrast the product costs computed under activity-based costing and conventional costing methods.eBook: Understand the basic approach in activity-based costing and how it differs from conventional costing.

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15.

value:
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