[The following information applies to the questions displayed below.] Pastina Company sells various types of pasta to grocery chains as private label brands. The company's fiscal year-end is December 31. The unadjusted trial balance as of December 31, 2018, appears below. Account Title Debits Credits Cash 41,750 Accounts receivable 53,000 Supplies 1,600 Inventory 72,000 Note receivable 24,900 Interest receivable 0 Prepaid rent 2,200 Prepaid insurance 0 Office equipment 84,000 Accumulated depreciation—office equipment 31,500 Accounts payable 32,000 Salaries and wages payable 0 Note payable 60,900 Interest payable 0 Deferred revenue 0 Common stock 60,000 Retained earnings 20,500 Sales revenue 208,000 Interest revenue 0 Cost of goods sold 93,600 Salaries and wages expense 18,300 Rent expense 12,100 Depreciation expense 0 Interest expense 0 Supplies expense 1,050 Insurance expense 5,200 Advertising expense 3,200 Totals 412,900 412,900 Information necessary to prepare the year-end adjusting entries appears below. Depreciation on the office equipment for the year is $10,500. Employee salaries and wages are paid twice a month, on the 22nd for salaries and wages earned from the 1st through the 15th, and on the 7th of the following month for salaries and wages earned from the 16th through the end of the month. Salaries and wages earned from December 16 through December 31, 2018, were $1,350. On October 1, 2018, Pastina borrowed $60,900 from a local bank and signed a note. The note requires interest to be paid annually on September 30 at 12%. The principal is due in 10 years. On March 1, 2018, the company lent a supplier $24,900 and a note was signed requiring principal and interest at 8% to be paid on February 28, 2019. On April 1, 2018, the company paid an insurance company $5,200 for a two-year fire insurance policy. The entire $5,200 was debited to insurance expense. $830 of supplies remained on hand at December 31, 2018. A customer paid Pastina $1,620 in December for 1,350 pounds of spaghetti to be delivered in January 2019. Pastina credited sales revenue. On December 1, 2018, $2,200 rent was paid to the owner of the building. The payment represented rent for December 2018 and January 2019, at $1,100 per month. Required: 1. & 2. Post the opening balances and adjusting entires into the appropriate t-accounts. (Enter the number of the adjusting entry in the column next to the amount. Do not round intermediate calculations. Round your final answers to nearest whole dollar.)

On January 1, 2016, Aspen Company acquired 80 percent of Birch Company's voting stock for $332,000. Birch reported a $370,000 book value and the fair value of the noncontrolling interest was $83,000 on that date. Then, on January 1, 2017, Birch acquired 80 percent of Cedar Company for $184,000 when Cedar had a $197,000 book value and the 20 percent noncontrolling interest was valued at $46,000. In each acquisition, the subsidiary's excess acquisition-date fair over book value was assigned to a trade name with a 30-year remaining life.

These companies report the following financial information. Investment income figures are not included.   

Assume that each of the following questions is independent:

1. If all companies use the equity method for internal reporting purposes, what is the December 31, 2017, balance in Aspen's Investment in Birch Company account?

2. What is the consolidated net income for this business combination for 2018?

3. What is the net income attributable to the noncontrolling interest in 2018?

4. Assume that Birch made intra-entity inventory transfers to Aspen that have resulted in the following intra-entity gross profits in inventory at the end of each year:

What is the accrual-based net income of Birch in 2017 and 2018, respectively?

a. If all companies use the equity method for internal reporting purposes, what is the December 31, 2017, balance in Aspen's Investment in Birch Company account?
b. What is the consolidated net income for this business combination for 2018?
c. What is the net income attributable to the noncontrolling interest in 2018?

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Assume that Birch made intra-entity inventory transfers to Aspen that have resulted in the following intra-entity gross profits in inventory at the end of each year:

What is the accrual-based net income of Birch in 2017 and 2018, respectively?

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On January 2, 2018, Athol Company bought a machine for use in operations. The machine has an estimated useful life of eight years and an estimated residual value of $1,500. The company provided the following information:

1. Invoice price of the machine, $73,150.
2. Freight paid by the vendor per sales agreement, $770.
3. Installation costs, $1,670 cash.
4. Cost of cleaning up the supplies, boxes, and other garbage that remained after the installation of the machine, $80 cash.
5. Payment of the machine's price was made as follows:

January 2:

• Issued 1,080 common shares of Athol Company at $5 per share.
• Signed a $42,000 note payable due April 16, 2018, plus 12 percent interest.
• Balance of the invoice price to be paid in cash. The invoice allows for a 2 percent cash discount if the cash payment is made by January 11.

January 15: Paid the balance of the invoice price in cash.

April 16: Paid the note payable and interest in cash.

6. On June 30, 2020, the company completed the replacement of a major part of the machine that cost $12,350. This expenditure is expected to reduce the machine’s operating costs, increase its estimated useful life by two years, and decrease its estimated residual value to $1,000.
7. Assume that on October 1, 2025, the company decided to replace the machine with a newer, more efficient model. It then sold the machine to Sako Ltd. on that date for $25,400 cash.

1. Compute the acquisition cost of the machine.

2. Prepare the journal entries to record the purchase of the machine and subsequent cash payments on January 15 and April 16, 2018. (Do not round intermediate calculations and round your final answers to the nearest dollar amount. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

January 2, 2018: Record purchase of machine by issuing shares, signing a note and the balance on account.

January 2, 2018: Record payment of machine installation costs.

January 15, 2018: Record payment made after discount period.

April 16, 2018: Record payment of note and interest

3. Compute the depreciation expense for each of the years 2018, 2019, and 2020, assuming the company’s fiscal year ends on December 31. Use the straight-line depreciation method. (Do not round intermediate calculations and round your final answers to the nearest dollar amount.)

4. Prepare the journal entry to record the sale of the machine on October 1, 2025. (Hint: First determine the balance of the accumulated depreciation account on that date.) (Do not round intermediate calculations and round your final answers to the nearest dollar amount. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Taxation table
Income Tax

Capital Allowances
Implements, plant and machinery and commercial vehicles:

Presumptive Taxes
Turnover Tax

Customs and Excise duties on used motor vehicles

Surtax
Surtax on all motor vehicle aged more than 5 years K2,000

Introduction
You are a tax assistant in a firm of chartered accountants. The firm has many clients and you are
part of a team that deals with small tax payers operating in Zambia. Your Tax senior has assigned
you some responsibilities relating to some clients whose information is presented in the extracts
below. You should deal with each client separately.
Client 1 – Jacob Zuze
Jacob commenced to trade on 1 September 2017 and prepared the first set of accounts for the
sixteen months period ended 31 December 2018. Your firm advised Jacob to register for Value
Added Tax (VAT) immediately he commenced to trade on 1 September 2017. He had bought
goods for resale on 1 August 2017 for K125,000 (including VAT) and all of these goods were still
available at 1 September 2017.
Jacob is now interested in knowing the total amounts of income tax and VAT that were payable
by him for the period of trading ended 31 December 2018.

The following additional information is available:
(1) Turnover and expenses accrued evenly throughout the sixteen months’ period. 10% of the
turnover consists of zero rated supplies and 20% consist of exempt supplies. The rest of the
turnover consists of standard rated supplies.
(2) 80% of purchases and other revenue expenses are attributed to the taxable turnover. The
remaining 20% are attributed to exempt supplies.
(3) Jacob had the following transactions in implements, plant and machinery during the sixteen
months period:

(4) It has been agreed with the Commissioner General that Jacob has private use of 25% in the
Toyota Camry motor car. The other revenue expenses of K150,800 shown in the statement
of profit or loss include K29,000 motor car expenses relating to the Toyota Camry motor car

(5) Unless stated otherwise, all of the above figures are VAT inclusive where applicable.
Client 2 – Vincent Kakuwa
Vincent commenced in business on 1 January 2017 trading as Kankuwa & Co. At the start of the
tax year 2017, his provisional income was K515,000. He calculated and paid the provisional
income tax correctly on the due dates and he also submitted the return of provisional income for
the tax year 2017 correctly. At the end of the tax year 2017, Kakuwa’s final taxable profit was
K590,000. Kakuwa calculated the balance of income tax still to be paid for the tax year 2017 and
he also calculated the provisional income for the tax year 2018 at K600,000 in January 2018.
As a result of unfavourable business conditions at the start of the year 2018, kakuwa revised his
provisional income in February 2018, from the original amount of K600,000 to only K510,000. The
unfavourable business conditions at the start of the year 2018 resulted in Kakuwa experiencing
serious liquidity problems such that he paid the provisional income tax for the quarter ended 31
March 2018 and also submitted the return of provisional income for the tax year 2018 on 30 June
2018. In addition, he paid the provisional income tax for the quarter ended 30 June 2018 together
with the balance of income tax for the tax year 2017 on 13 August 2018. He also submitted his
self assessment income tax return for the tax year 2017 on 13 August 2018. Cash flow problems
were fully resolved after 13 August 2015 and Kakuwa is certain that all the outstanding taxes
thereafter would be paid properly.
In September 2018, Mooya received a notice from the Commissioner General stating that his self
assessment Income tax return for the tax year 2018 was the subject of a compliance check. When
computing taxable income of K590,000 for the tax year 2017, it is alleged that Kakuwa deducted
a non-allowable private expense of K27,600. The Commissioner General therefore raised an
assessment for underpaid income tax of K10,350 in respect of the tax year 2017 and this notice
was served on Mooya on 15 September 2018. No adjustment was required to the return of
provisional income for the tax year 2018 as this return was subjected to the compliance check.
Client 3 – Jennifer Liungu
Jennifer intends to commence in business on 1 January 2019. She needs to engage four workers
in her business and each worker will be paid an annual salary of K48,000. Jennifer will also earn
an annual salary of K72,000 from the business. Her business is expected to earn a turnover of
K760,000 per annum in each of the first two years of trading. All of Jennifer’s sales will be zero
rated supplies for VAT purposes and the business will be profitable. Jennifer will run the business
from rented premises.
The budgeted statement of profit or loss for the year ending 31 December 2019 is as follows:

Rent and other revenue expenses are standard rated supplies and the amounts recognized in the
statement of profit or loss are inclusive of VAT. Sales revenue, cost of sales and operating
expenses will accrue evenly throughout the year ending 31 December 2019.

Required:
(a) Client 1

(ii) Calculate the VAT paid by Jacob for each of the tax years 2017 and 2018. You MUST
clearly show the amounts of output tax and the recoverable input tax for each supply
for each of the two tax years. Monthly figures of VAT are NOT REQUIRED.

(iii) Assuming that the income tax rates and bands for the tax year 2018 apply to the tax
year 2017 as well, calculate the income tax paid by Jacob for each of the tax years
2017 and 2018.
(iv) Explain how the VAT and income tax you have calculated above should have been
properly paid, stating the relevant due dates and the amounts payable on each due
date.
(b) Client 2
(i) Advise Kakuwa of the amounts of penalties and interest on overdue taxes and tax
returns charged on all payments and tax return submissions made up to and including
13 August 2018.
(ii) State the possible reasons why the Commissioner General has subjected Kakuwa’s
self assessment income tax return for the tax year 2018 to a compliance check.

(iii) Explain the initial alternative courses of action that are open to Kakuwa following
receipt of the notice of assessment showing additional income tax payable for the tax
year 2017 of K10,350.
(i) Advise kakuwa of the interest on overdue tax and penalties that he may be liable for
as a result of the Commissioner General’s compliance check into his self assessment
income tax return for the tax year 2017and state a possible reason why these penalties
and interest may apply.
(c) Client 3

(iii) If Jennifer registers voluntarily for VAT, calculate:
(1) The amount of VAT that she would pay and explain how it may have to be properly
paid.
(2) The amount of income tax that she would have to pay
(Total: 100 marks)

Suppose you read the following headline: “Taking an aspirin a day can cut your risk of heart attack by almost half!” Suppose the news report goes on to tell you that the research is based on a very large well-designed randomized experiment with a p-value less than 0.0001. Assume this information is technically correct, given the results of the study. Which of the following statistics could actually represent the results of this study?

Question text

A researcher is interested in whether the attractiveness of the instructor influences student attendance at the statistics lab. The independent variable is the attractiveness of the lab instructor (assuming three instructors are of the same gender and are equally competent). The dependent variable is the number of times a student attends statistics lab during one semester. There are three groups with data:
Group 1(unattractive instructor): 20, 13, 9, 22, 21
Group 2: moderately attractive instructor: 24, 27, 25, 20, 29
Group 3: attractive instructor: 30, 24, 26, 28, 27
Based on the above information, 1) what is MSbetween? 2) what is the calculated F?, and 3) which group means are significantly different from each other based on Bonferroni correction?
Group 1 – Group 2: Significant Non-significant
Group 1 – Group 3: Significant Non-significant
Group 2 – Group 3: Significant Non-significant