Use the financial statements below for problems 4 to 7

                              Balance Sheet

4.   Construct a common size balance sheets for 2017 and 2018. Comment on any changes in the percentages of assets and liabilities.

5.   Construct a common size income statement 2017 and 2018. Comment on any of the changes in the composition of the income statement.

Situation: Suppose a large portion (approximately 20%) of the United States decides that the COVID-19 epidemic is a sign of the coming apocalypse within the month (assume they are wrong). Approximately half of this group decides to spend all their wealth on doomsday preparation and charitable acts. The other half of this group decides that the world is doomed, there is no hope of fighting it and decides to party and have as much fun as possible for the next month.

1. Using words (and math if you’d like) describe the macroeconomic impacts of these groups’ actions. What will be the impact on total, consumption, and investment spending, net exports, and the price level? Will interest rates be affected? If so, how?
2. Graph the changes described in your answer to question 1. Use all appropriate graphs in your answer (AD-AS, Supply and Demand, Loanable Funds Market, Money Market, etc.).
3. Based on your answer to question 1:
a. What is the appropriate governmental policy response, if any, after a month has passed and each group is proven wrong? Defend your answer.
b. What will be the impact on total, consumption, and investment spending, net exports, and the price level? Will interest rates be affected? If so, how?
4. Graph the changes describe in your answer to question 3. Use all appropriate graphs in your answer (AD-AS, Supply and Demand, Loanable Funds Market, Money Market, etc.).

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.Need Answer ASAP

E14-19 (LO4) (Fair Value Option) Fallen Company commonly issues long-term notes payable to its various lenders. Fallen has had a pretty good credit rating such that its effective borrowing rate is quite low (less than 8% on an annual basis). Fallen has elected to use the fair value option for the long-term notes issued to Barclay’s Bank and has the following data related to the carrying and fair value for these notes. Any changes in fair value are due to changes in market rates, not credit risk.

Instructions

(a)Prepare the journal entry at December 31 (Fallen’s year-end) for 2017, 2018, and 2019, to record the fair value option for these notes.

(b)At what amount will the note be reported on Fallen’s 2018 balance sheet?

(c)What is the effect of recording the fair value option on these notes on Fallen’s 2019 income?

(d)Assuming that general market interest rates have been stable over the period, does the fair value data for the notes indicate that Fallen’s creditworthiness has improved or declined in 2019? Explain.

Please copy and paste answer not attachment.

c) A firm has the following capital structure: 100 million shares outstanding, trading at £1.5 per share, and £100 million of debt. The beta of the firm’s stock is 1.5. The firm’s cost of equity is 10 percent, and the yield on riskless bonds is 2.5 percent. There is no tax. Assuming that the firm can borrow at the risk free rate and that both CAPM (Capital Asset Pricing Model) and the Modigliani-Miller theorem hold, answer the following questions.

iv) Suppose the firm changes its capital structure so that its debt increases to £150 million, and the equity decreases by £50 million. What should be the firm’s cost of equity after the change?

*Different question*

c) A firm has the following capital structure: £100 million of equity (market value) with 100 million shares outstanding, and £100 million of debt. The beta of the firm’s stock is 1.6. The firm’s cost of equity is 10 percent, and the yield on riskless bonds is 2 percent. There is no tax. Assuming that the firm can borrow at the risk free rate and that both CAPM (Capital Asset Pricing Model) and the Modigliani-Miller theorem hold, answer the following questions

iv) Suppose the firm changes its capital structure so that its debt increases to £140 million, and the equity decreases to £60 million. What should be the firm’s cost of equity after the change?

Zemfira Inc., EBIT and Leverage. (Ross #1 ch.13) Zemfira Inc., has no debt outstanding and a total market value of $125,000. Earnings before interest and taxes are projected to be $10,400 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 20 percent higher. If there is a recession, then EBIT will be 35 percent lower. Zemfira is considering a $42,000 debt issue with a 6 percent interest rate. The proceeds will be used to repurchase shares of stock. There are currently 6,250 shares outstanding. Ignore taxes for part a and b. a. Calculate EPS under each of three economic scenarios before any debt is issued. Also, calculate the percentage changes in EPS when the economy expands or enters a recession. b. Repeat part (a) assuming that Zemfira goes through with recapitalization. c. Repeat parts (a) and (b) assuming Zemfira has a tax rate of 35 percent. Will the percentage change in EPS be the same both with and without taxes? d. Suppose the company has a market-to-book ratio of 1.0 i. Calculate ROE under each of three economic scenarios before any debt is issued. Also, calculate the percentage changes in ROE for economic expansion and recession, assuming no taxes. ii. Repeat part (a) assuming the firm goes through with proposed recapitalization. iii. Repeat parts (a) and (b) assuming the firm has a tax rate of 35 percent.

19. Under sum-of-the-years’-digits depreciation . . .

a. the book value remains the same each year.

b. the depreciation rate changes each year.

c. the denominator of the SYD fraction changes each year.

d. all of the above.

20. For assets acquired during the year, the sum-of-the-years’-digits method requires that the same depreciation rate be used . . .

a. for the remaining months of the year of acquisition, then again in the final year of the asset’s estimated life for any months not depreciated in Year 1.

b. for 12 consecutive months, even if that results in the same rate being used in two different calendar years.

c. throughout the life of the asset.

d. until the end of the calendar year, then recomputed for the next calendar year.

21. Company records show that an employee provided with a company car drove it 80% for business and 20% for personal use. The company reports the personal use as income on the employee’s W-2. As a result . . .

a. the company can depreciate 80% of the car’s cost basis.

b. the company cannot depreciate the car.

c. the company can depreciate 100% of the car’s cost basis.

d. the company can depreciate the car without IRS limits on annual depreciation.

22. On which of the following assets can a company take a Sec. 179 deduction?

a. a warehouse

b. a computer

c. a rental apartment building

d. an office building

Case study: Chapter 2- The Environment- Labour Relations textbook

Armand, Bob, and Courtney worked as customer service representatives at a company that managed a toll road. Employees at the company are represented by a union. All three employees worked at the front counter, and their duties included issuing transponders, receiving payments, receiving faxes to provide service to customers, and assisting in the company’s call center when call volumes were high. In order to do their jobs, the customer service representatives on the front counter were required to go to a fax machine in another area of the building and also to escort customers to other areas of the complex several times a day. Security was a concern at the company because of expensive equipment on the premises, client information that was held, and possible hostile customers. The company had a security system in place that required employees to use a swipe card and enter a password to gain entry at various points in the building. The company encountered problems with the misuse and loss of swipe cards. The employer proposed a new biometric scanning system that relied upon the measurement of the right hand when it was placed on a screenArmand, Bob, and Courtney worked as customer service representatives at a company that managed a toll road. Employees at the company are represented by a union. All three employees worked at the front counter, and their duties included issuing transponders, receiving payments, receiving faxes to provide service to customers, and assisting in the company’s call center when call volumes were high. In order to do their jobs, the customer service representatives on the front counter were required to go to a fax machine in another area of the building and also to escort customers to other areas of the complex several times a day. Security was a concern at the company because of expensive equipment on the premises, client information that was held, and possible hostile customers. The company had a security system in place that required employees to use a swipe card and enter a password to gain entry at various points in the building. The company encountered problems with the misuse and loss of swipe cards. The employer proposed a new biometric scanning system that relied upon the measurement of the right hand when it was placed on a screen.

The system would also work with employees swiping a card and entering a password instead of a hand measurement; however, the employer wanted to incorporate the hand scanning as part of the system to facilitate its attendance management program. Scanning devices would be placed at numerous locations in the complex to control and monitor access to various departments. Eight employees who were members of the Pentecostal faith objected to the proposed scanning system because of their religious beliefs. Although the Pentecostal church is not specifically opposed to biometric scanning, the employees felt that the system was counter to their religious beliefs because it would impose “the mark of the beast” upon them as prophesied in the Book of Revelation. The religious objection related to using measurements of portions of the body for the purposes of identification where such measurements have a number associated with them, the number becomes part of a system of numbers, and that system is involved in the ability to earn a living. The concerns are heightened for some individuals when the measurements are derived from the right hand. When the employees objected to the new system, the employer proposed that they use their left hands and also proposed the employees be allowed to wear a glove over their hand. (The system relied upon a hand measurement, not fingerprints.) Five employees were satisfied with the changes proposed by the employer and dropped their objection to the scanning devices. When Armand, Bob, and Courtney continued to refuse to use the new system, the employer proceeded to apply its progressive discipline policy. The employer did not meet with the union or the employees other than through the disciplinary process. The employees were given warnings, formal letters, and subsequently terminated when they refused to take part in the new system.

Questions:

1. Is there any discrimination in this situation? If so, what type of discrimination is involved?

2. What is the obligation of the employer?

3. If this case proceeded to a hearing, explain the outcome you expect.

The Orthotic Group case study demonstrates how performance management is important to continuously improve. As you read the case, think about the balanced scorecard approach and how you would set metrics for your team to generate the results needed to remain competitive. The Orthotic Group, located in Ontario, Canada, prides itself on providing superior service to healthcare professionals globally. A custom manufacturer of orthotics that can be inserted into footwear, the company also supplies compression hosiery and footwear. Healthcare professionals can order online through the website, through two technological options, Gaitscan or OHI1Scan or by sending foot impression forms through the postal service. With a strong customer base, The Orthotic Group is considered a leader in the industry as a result of their quality, order cycle time, and problem resolution process. In 2017, after a competitive analysis, it was determined that delivery times from order placement to delivery in the industry had become more competitive. Along with this new competitive requirement, performance metrics for the past 6 months had been slipping from their previous norms. While there had been some minor turnover amongst the production staff, the turnover was no more than previous years. A new manager had been hired who had been making changes. Some of these changes were popular with the production workers, while others were not. Work-in-Process (WIP) inventory began to pile up in key areas of the production line. The new manager left the organization 3 months prior to the busy fall season. The Vice-President Operations thought it would be a good opportunity to embark upon a Lean Process Improvement initiative with the employees. The goal was to reduce the turn-around-time (TAT) and work-in-process inventory (WIP), while maintaining and improving the quality of their orthotics. The Production Supervisor compiled a team of workers from production to gain their insights into what was slowing the team down. Through observations and collaboration with the team it was noted that the following conditions were preventing The Orthotic Group from achieving their targets: While the company had a metric board on the T.V. screen posted above the production line, the first production step, the Technician cell, did not know how many orthotics they produced as a team. Results were provided the next day as a component of the daily stand-up, Workers were processing orders in batches of 10 or more, There was a high degree of variability in worker productivity, First-in-First-Out (FIFO) priority system was not being maintained as workers would work on “easy” orders first instead of higher difficulty orders to push the orders through. At this point the Production Supervisor is preparing a report to discuss priorities with the Vice President – Operations.

The Orthotic Group case study demonstrates how performance management is important to continuously improve. As you read the case, think about the balanced scorecard approach and how you would set metrics for your team to generate the results needed to remain competitive.

Questions:1 Explain what a Lean Process Improvement plan is? What is involved in this type of initiative? (15%) Please use your original words and thoughts and only use direct quotes to prove a point in your arguments. References may be required if you are utilizing outside resources. Copying word for word or paraphrasing can lead to Academic Misconduct. This applies to all questions.

Question: 2 From a functional perspective, which category(ies) of performance metrics are likely currently in use at the manufacturing center prior to the Lean Improvement Process. Explain why you believe this? Is this the right approach going forward given the Lean Improvement initiative? (20%) See warning in Question 1.

Question: 3 What role does IT have in the company when it comes to performance measurement? In your opinion is the Information Technology resources being employed effectively? What are your recommendations? (20%) See warning in Question 1.

Question: 4 Develop 5-6 key metrics (for the balanced scorecard) the company should measure in the manufacturing environment as a result of a lean Improvement initiative. Why are these important? What purpose do they serve? Try to look beyond the textbook for key ideas of what will influence world-class performance for the company. (20%) See warning in Question 1.

Question: 5 Your group represents the team that has been operating the Lean Improvement Process and you are writing a short executive summary (1 page minimum) to the VP Operations so the VP can show the executive group the recommendations. Based on questions 1-4, and the problems they have identified, write up the executive summary with your conclusions and supporting rationale for these improvements. (25%) See warning in Question 1, and the problems they have identified, write up the executive summary with your conclusions and supporting rationale for these improvements. (25%) See warning in Question