On 1 June2020, Purchase Limited enters into a firm commitment
Supply Limited to buy USD 100,000 of
inventory. On 1 July 2020, the Purchase Limited enters into a
hedging arrangement which meets the hedge
accounting criteria stipulated by the accounting standards
(Australian Accounting Standards Board (AASB) 9).
Purchase Limited has designated the firm commitment hedging
arrangement as a fair value hedge. On 1 August
2020, Supply Limited transfers the inventory to Purchase Limited,
and on that date, the Purchase Limited makes
the payment. The spot and forward rates are as follows.
| Date | Spot rate in AUD | Forward rate in AUD |
| 1 June 2020 | 0.19 | 0.2 |
| 30 June 2020 | 0.2 | 0.25 |
| 1 August 2020 | 0.3 | 0.3 |
Required:
a) Explain at least two determinants of determining an
effectiveness of a hedge instrument against a
hedge
5 Marks
b) Provide journal entries to account for the hedged item (firm
commitment to buy inventory) 8 Marks
i. On 1 June 2020
ii. On 30 June 2020
iii. On 1 August 2020
c) Provide journal entries to account for the hedge instrument
(forward contract) 7 Marks
i. On 1 June 2020
ii. On 30 June 2020
iii. On 1 August 2020
In: Accounting
Coal is carried from a mine in West Virginia to a power plant in New York in hopper cars on a long train. The automatic hopper car loader is set to put 51 tons of coal into each car. The actual weights of coal loaded into each car are normally distributed, with mean μ = 51 tons and standard deviation σ = 1.3 ton.
(a) What is the probability that one car chosen at random will
have less than 50.5 tons of coal? (Round your answer to four
decimal places.)
(b) What is the probability that 21 cars chosen at random will have
a mean load weight x of less than 50.5 tons of coal?
(Round your answer to four decimal places.)
(c) Suppose the weight of coal in one car was less than 50.5 tons.
Would that fact make you suspect that the loader had slipped out of
adjustment?
YesNo
Suppose the weight of coal in 21 cars selected at random had an
average x of less than 50.5 tons. Would that fact make you
suspect that the loader had slipped out of adjustment? Why?
Yes, the probability that this deviation is random is very small.Yes, the probability that this deviation is random is very large. No, the probability that this deviation is random is very small.No, the probability that this deviation is random is very large.
The personnel office at a large electronics firm regularly schedules job interviews and maintains records of the interviews. From the past records, they have found that the length of a first interview is normally distributed, with mean μ = 38 minutes and standard deviation σ = 6 minutes. (Round your answers to four decimal places.)
(a) What is the probability that a first interview will last 40
minutes or longer?
(b) Fifteen first interviews are usually scheduled per day. What is
the probability that the average length of time for the fifteen
interviews will be 40 minutes or longer?
Find P(33 ≤ x ≤ 38). (Round your answer to four decimal places.)
In: Statistics and Probability
You are the director of pharmacy at a large regional medical
center. It has come to your attention that Dr. Smith, a hospital
oncologist, has been prescribing medicines for cancer patients that
are not labeled for cancer treatment. While "off-label"
prescription is not against the law, you now recall a recent
interview Dr. Smith did on a radio talk show. During that interview
Dr. Smith talked about his discovery of the effectiveness of
green-tea, honey and homeopathic treatments for cancer patients.
Such a "holistic" approach to medicine has a certain appeal,
especially to patients who have received a poor prognosis. Many
cancer patients who were told they have only a few months to live
by their doctors have come to your hospital from hundreds of miles
away to be treated by Dr. Smith.
In addition to his work at your hospital, Dr. Smith owns and runs a
clinic located in a poor Mississippi Delta community. When your
hospital recently replaced its old outdated sterilizer machines,
Dr. Smith asked if he could have one of the old machines for use at
his clinic. Dr. Smith is well known and most of his patients like
him. Last year he received an award from a religious group for his
service to the poor. However, you know that Dr. Smith recently
divorced his third wife. Her lawyer, known for her aggressive style
and hard bargaining, won a huge alimony and support judgment worth
$3 million against Dr. Smith. Rumor is that Dr. Smith is struggling
financially, because he sold one of his sports cars.
How should you handle this situation? In your paper, be sure to
consider the responsibilities and interests of your department, as
well as the hospital. Include the issues of insurance
reimbursement, standard of care, informed consent, public image of
the hospital, and Medicare/Medicaid reimbursement. Are there other
legal issues? Are there other moral or ethical issues?
In: Nursing
This question covers aspects and integration of personal development planning and data analysis skills towards professional engineering competencies for employability.
Consider the data-set shown in Table 2, which is a subset of employment statistics for the UK from between 2009 and 2018. For the dates specified, the data records an estimate of the number of thousands of engineering professionals, and of IT and Telecommunications professionals, classified according to sex.
Table 2 A subset of employment statistics for the UK from 2009 until 2018
| Date | Sex | Total Thousands (000’s) employed | |
|---|---|---|---|
| Engineering | IT & Telecoms | ||
| Apr-Jun 2009 | F | 36 | 56 |
| Apr-Jun 2009 | M | 431 | 420 |
| Apr-Jun 2010 | F | 32 | 67 |
| Apr-Jun 2010 | M | 460 | 421 |
| Apr-Jun 2011 | F | 27 | 120 |
| Apr-Jun 2011 | M | 395 | 651 |
| Apr-Jun 2012 | M | 392 | 675 |
| Apr-Jun 2012 | F | 23 | 120 |
| Apr-Jun 2013 | M | 398 | 738 |
| Apr-Jun 2014 | F | 32 | 124 |
| Apr-Jun 2015 | F | 42 | 171 |
| Apr-Jun 2015 | M | 426 | 758 |
| Apr-Jun 2016 | F | 37 | 173 |
| Apr-Jun 2016 | M | 438 | 777 |
| Apr-Jun 2017 | F | 48 | 155 |
| Apr-Jun 2018 | F | 58 | 165 |
| Apr-Jun 2018 | M | 433 | 834 |
Source: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/datasets/employmentbyoccupationemp04
In: Math
Transactions from Gravenhurst Inc.’s current year follow.
Gravenhurst follows IFRS.
| 1. | Gravenhurst Inc. thinks it should dispose of its excess land.
While the carrying value is $50,000, current market prices are
depressed and only $25,000 is expected upon disposal. The following
journal entry was made:
|
||||||||||||||||||||
| 2. | Merchandise inventory that cost $630,000 was reported on the
statement of financial position at $690,000, which is the expected
selling price less estimated selling costs. The following entry was
made to record this increase in value:
|
||||||||||||||||||||
| 3. | The company is being sued for $500,000 by a customer who claims
damages for personal injury that was allegedly caused by a
defective product. Company lawyers feel extremely confident that
the company will have no liability for damages resulting from the
situation. Nevertheless, the company decides to make the following
entry:
|
||||||||||||||||||||
| 4. | Because the general level of prices increased during the
current year, Gravenhurst Inc. determined that there was a $15,000
understatement of depreciation expense on its equipment and decided
to record it in its accounts. The following entry was made:
|
||||||||||||||||||||
| 5. | Gravenhurst Inc. has been concerned about whether intangible
assets could generate cash in case of liquidation. As a result,
goodwill arising from a business acquisition during the current
year and recorded at $800,000 was written off as follows:
|
||||||||||||||||||||
| 6. | Because of a “fire sale,” equipment that was obviously worth
$200,000 was acquired at a bargain price of $155,000. The following
entry was made:
|
||||||||||||||||||||
In each of the above situations, discuss the appropriateness of the
journal entries in terms of generally accepted accounting
principles. For the purposes of your discussion, assume that the
financial statements, particularly net income, will be used by the
court in a divorce settlement for the company president’s
spouse.
In: Accounting
The following facts relate to Novak Corporation.
| 1. | Deferred tax liability, January 1, 2020, $24,400. | |
| 2. | Deferred tax asset, January 1, 2020, $0. | |
| 3. | Taxable income for 2020, $115,900. | |
| 4. | Pretax financial income for 2020, $244,000. | |
| 5. | Cumulative temporary difference at December 31, 2020, giving rise to future taxable amounts, $292,800. | |
| 6. | Cumulative temporary difference at December 31, 2020, giving rise to future deductible amounts, $42,700. | |
| 7. | Tax rate for all years, 20%. | |
| 8. | The company is expected to operate profitably in the future. |
A. Compute income taxes payable for 2020.
| Income taxes payable |
$enter Income taxes payable in dollars |
B. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
C. Prepare the income tax expense section of the income statement for 2020, beginning with the line “Income before income taxes.” (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
|
Novak Corporation |
||
|---|---|---|
|
select an income statement item CurrentDeferredDividendsExpensesIncome before Income TaxesIncome Tax ExpenseNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
$enter a dollar amount |
|
|
select an opening section name CurrentDeferredDividendsExpensesIncome before Income TaxesIncome Tax ExpenseNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
||
|
select an income statement item CurrentDeferredDividendsExpensesIncome before Income TaxesIncome Tax ExpenseNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
$enter a dollar amount |
|
|
select an income statement item CurrentDeferredDividendsExpensesIncome before Income TaxesIncome Tax ExpenseNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
enter a dollar amount |
|
|
enter a subtotal of the two previous amounts |
||
|
select a closing name for this statement CurrentDeferredDividendsExpensesIncome before Income TaxesIncome Tax ExpenseNet Income / (Loss)Retained Earnings, January 1Retained Earnings, December 31RevenuesTotal ExpensesTotal Revenues |
$enter a total net income or loss amount |
|
In: Accounting
On April 2019, Manama Company opened its first branch. Separate accounting records were established for the branch. Both the home office and the branch used the perpetual inventory system. Among the intercompany transactions were the following: 1. The company transfer $10,000 cash to the branch. 2. Home office shipped merchandise costing $130,300 to branch at a billed price of $162,500. 3. Credit sales by the branch amounted to 80,000, and the cost of goods sold was $56,750. 4. Branch acquired truck for $4,000 cash and a note payable of $11,000; both the truck and the note payable will be carried in the accounting records of the home office. 5. The branch paid operating expenses of $30,000. 6. Operating expenses incurred by the home office and charged to the Branch totaled $4,400. Instructions: Prepare the journal entries on the Company records and on the branch records?
In: Accounting
Strods Company reported the following purchases and sales of its only product. Strods uses a periodic inventory system. Determine the cost assigned to ending inventory using LIFO.
| Date | Activities | Units Acquired at Cost | Units Sold at Retail |
| May 1 | Beginning Inventory | 170 units @ $12 | |
| 5 | Purchase | 230 units @ $14 | |
| 10 | Sales | 150 units @ $22 | |
| 15 | Purchase | 110 units @ $15 | |
| 24 | Sales | 100 units @ $23 | |
Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. On August 11, it returned $1,500 worth of merchandise. On August 16, it paid the full amount due. The correct journal entry to record the purchase on August 7 is:
In: Accounting
Leonard Company has been in business for 3 years. In 2011, it reported a loss of $10,000 on trading securities. In 2012, there was a $5,000 gain. Finally, in 2013 the company had a $20,000 loss. As of the beginning of 2014 the company owned 15,000 shares of Shimkus Corp., 2,000 shares of Newton Corp., and 100 shares of Lathrop, Inc. The original cost of the shares was $450,000, $210,000, and $115,000, respectively. During 2014, Leonard sold 5,000 shares of Shimkus Corp. for $170,000 and acquired 1,000 shares of Smith Corp. for $40 per share. At year-end the Shimkus Corp. was $28 per share, Newton Corp. was $110 per share, Lathrop, Inc. was $1020 per share, and Smith Corp. was $42 per share.
Prepare a schedule (or a t-account) that shows the cumulative balance in adjustment to market account at December 31, 2013.
In: Accounting
The financial statements for Waverley Ltd are provided below:
Waverley Ltd
Comparative Balance Sheet
As at 30 June 2019 and 2020
|
2019 |
2020 |
|
|
Assets |
||
|
Cash At Bank |
167,000 |
215,000 |
|
Accounts Receivable |
213,000 |
158,000 |
|
Inventory |
68,000 |
73,000 |
|
Prepaid Rent |
4,000 |
5,000 |
|
Buildings |
320,000 |
350,000 |
|
Accumulated Depreciation – Buildings |
(108,000) |
(132,000) |
|
Equipment |
67,000 |
78,000 |
|
Accumulated Depreciation – Equipment |
(25,000) |
(26,000) |
|
706,000 |
721,000 |
|
|
Liabilities |
||
|
Accounts Payable |
236,000 |
228,000 |
|
Dividend Payable |
12,000 |
13,000 |
|
Salary Payable |
18,000 |
20,000 |
|
Tax Payable |
16,000 |
17,000 |
|
Bank Loan |
158,000 |
171,000 |
|
440,000 |
449,000 |
|
|
Equity |
||
|
Capital |
170,000 |
164,000 |
|
Retained Earnings |
96,000 |
108,000 |
|
266,000 |
272,000 |
Waverley Ltd
Income Statement
For the Year Ended at 30 June 2020
|
Sales |
1,000,000 |
|
|
COGS |
(450,000) |
|
|
Gross Profit |
550,000 |
|
|
Profit on sale of Equipment |
2,000 |
|
|
Rent |
42,000 |
|
|
Salary |
400,000 |
|
|
Interest |
12,000 |
|
|
Depreciation Expense – Buildings |
13,000 |
|
|
Depreciation Expense – Equipment |
15,000 |
|
|
(482,000) |
||
|
Net Profit before Tax |
70,000 |
|
|
Less Taxation expense |
(21,000) |
|
|
Net Profit |
49,000 |
Required:
Prepare an extract of the Cash Flow Statement (Direct Method) for the year ended 30 June 2020 showing Cash Flows from Operating Activities AND Cash Flows from Financing Activities. Show all workings.
If possible, in workings for the cash flow, please use ledgers to show your calculations. For example, ‘Accounts Receivable’ Ledger to get the value of ‘Cash flow from Customers’
Ledger Templet
*Please upload the solution as soon as you can finish it. Thanks for your help
In: Accounting