Blue Department Store converted from the conventional retail method to the LIFO retail method on January 1, 2020, and is now considering converting to the dollar-value LIFO inventory method. During your examination of the financial statements for the year ended December 31, 2021, management requested that you furnish a summary showing certain computations of inventory cost for the past 3 years.

Here is the available information.

Compute the cost of inventory on hand at December 31, 2019, based on the conventional retail method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987)

Compute the inventory to be reported on December 31, 2019, in accordance with procedures necessary to convert from the conventional retail method to the LIFO retail method beginning January 1, 2020. Assume that the retail value of the December 31, 2019, inventory was $60,900. (Round ratios for computational purposes to 2 decimal places, e.g. 78.72% and final answer to 0 decimal places, e.g. 28,987.)

Without prejudice to your solution to part (b), assume that you computed the December 31, 2019, inventory (retail value $60,900) under the LIFO retail method at a cost of $36,845. Compute the cost of the store’s 2020 and 2021 year-end inventories under the dollar-value LIFO method. (Round ratios for computational purposes to 2 decimal places, e.g. 78.72% and final answer to 0 decimal places, e.g. 28,987.)

Matt and Meg Comer are married and file a joint tax return. They do not have any children. Matt works as a history professor at a local university and earns a salary of $64,700. Meg works part-time at the same university. She earns $34,000 a year. The couple does not itemize deductions. Other than salary, the Comers’ only other source of income is from the disposition of various capital assets (mostly stocks).

a.

a. What is the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year?

b.

What is the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year?

Female athletes at the University of Colorado, Boulder, have a long-term graduation rate of 67% (Source: Chronicle of Higher Education). Over the past several years, a random sample of 38 female athletes at the school showed that 21 eventually graduated. Does this indicate that the population proportion of female athletes who graduate from the University of Colorado, Boulder, is now less than 67% ? Use a 5% level of significance.

a) Which distribution applies: the Standard Normal or the t distribution? Why?

b) What is the value of the level of significance? State the null and alternate hypotheses. Is it a left-tailed, right-tailed, or two-tailed test?

c) Compute the value of the sample test statistic (either t* or z*).

d) Find the critical value(s). Sketch the sampling distribution and show the critical value(s) and region(s).

e) Based on your answers in parts (a) to (d), will you reject or fail to reject the null hypothesis at the given level of significance?

f) Interpret your conclusion in the context of the application.

Question Set 1: Two Independent Proportions

Reminder: The standard error is computed differently for a two-sample proportion confidence interval and a two-sample proportion hypothesis test.

Researchers are comparing the proportion of University Park students who are Pennsylvania residents to the proportion of World Campus students who are Pennsylvania residents. Data from a sample are presented in the contingency table below.

1. Construct a 95% confidence interval to estimate the difference between the proportion of all University Park students who are Pennsylvania residents and the proportion of all World Campus students who are Pennsylvania residents. If assumptions are met, use the normal approximation method. Show how you checked assumptions. You should not need to do any hand calculations. Use Minitab Express to construct the confidence interval. Remember to copy+paste all relevant Minitab Express output and always clearly identify your final answer. [15 points]

B. Interpret the confidence interval that you computed in part A by completing the following sentence. [5 points]

I am 95% confident that…

C. Use the five-step hypothesis testing procedure given below to determine if there is evidence of a difference between the proportion of University Park students who are Pennsylvania residents and the proportion of World Campus students who are Pennsylvania residents. If assumptions are met, use the normal approximation method. Use Minitab Express. You should not need to do any hand calculations. Remember to copy+paste all relevant Minitab Express output. [30 points]

Step 1: Check assumptions and write hypotheses

Step 2: Calculate the test statistic

Step 3: Determine the p-value

Step 4: Decide to reject or fail to reject the null hypothesis

Step 5: State a real-world conclusion

On January 1, 2018, M Company granted 95,000 stock options to certain executives. The options are exercisable no sooner than December 31, 2020, and expire on January 1, 2024. Each option can be exercised to acquire one share of $1 par common stock for $10. An option-pricing model estimates the fair value of the options to be $4 on the date of grant.

If unexpected turnover in 2019 caused the company to estimate that 15% of the options would be forfeited, what amount should M recognize as compensation expense for 2019?

On July 2020, Sotoma Pty Ltd noticed that a number of its employees have been with the company for a number of years including some who have actually been working for more than 10 years. The company has always provided annual leave and sick leave to its employees. However, our accounting team is not sure whether these employees are entitled to any other employee benefits. It would be much appreciated if you could give the accounting team some clarification on this matter and how to deal with this in our accounts.

A company issues term bonds totaling $300,000 on January 1, 2014. The bonds have a coupon rate of 5%, pay interest semi-annually on Jan 1st and July 1st of each year, and mature in 10 years. The bonds are issued at an effective market rate of 4%, which corresponds to a price of 108.176 ($324,527). The company incurred bond issue costs totaling $35,000. Given this information calculate the following for January 1, 2020:

Bonds Payable-Face Value:

Premium on Bonds Payable:

Unamortized Bond Issue Costs:

On December 31, 2017, University Security Inc. showed the following:

*All of the shares had been issued early in 2016.

Required:
Part 1:
Calculate book value per common share and preferred share at December 31, 2017, assuming no dividends were declared for the years ended December 31, 2016 or 2017, and that the preferred shares are:

a. Cumulative. (Round the final answers to 2 decimal places.)    
1.common share -

2 preferred shares -

find book valur in context to both


b. Non-cumulative. (Round the final answers to 2 decimal places.)

1.common share -

2 preferred shares -

find book valur in context to both

Part 2:
Calculate book value per common share and preferred share at December 31, 2017, assuming total dividends of $91,000 were declared and paid in each of the years ended December 31, 2016 and 2017, and that the preferred shares are:

c. Cumulative. (Round the final answers to 2 decimal places.)    

1.common share -

2 preferred shares -

find book valur in context to both

d. Non-cumulative. (Round the final answers to 2 decimal places.)   

1.common share -

2 preferred shares -

find book valur in context to both

3. The University Secretary wants to determine how University grade point average, GPA (highest being 4.0) of a sample of students from the University depends on a student’s high school GPA (HS), age of a student (A), achievement test score (AS), average number of lectures skipped each week (S), gender of a student (where M=1 if a student is male or 0 otherwise), computer or PC ownership of a student (where PC=1 if a student owns a computer or 0 otherwise), the means of transport to school (drive, bicycle or walk; where D=1 if a student drives to campus or 0 otherwise, B=1 if a student bicycles to campus or 0 otherwise), and finally, the subject major of the student (finance, human resource, marketing and accounting; where F=1 if a student majors in finance or 0 otherwise, HR=1 if a student majors in human resource or 0 otherwise, MR=1 if a student majors in marketing or 0 otherwise). Use the correlation matrix and dummy regression output to answer the questions.

1. Which 2 pairs of variables are most correlated with the regress and?
2. Which 3 pairs of variables are mostly multicollinear?
3. Identify 3 pairs of variables that are most correlated.