a. Construct a scatterplot of the data and tell why a linear regression model is appropriate. (Include this graph in your report.)   b. Run the linear regression procedure on StatCrunch and include the output in your report. c. Give the regression equation using the correct notation. d. Give the Coefficient of Determination AND interpret it.   e. Check the assumptions of the model by constructing each of the following plots and commenting on what they suggest in terms of the assumptions. (Include these graphs in your report.) 1. Fitted line plot 2. QQ-Plot of the residuals 3. Predicted values vs residuals


f. Test to see if the ‘before reading’ is useful in predicting the ‘after reading’. (Use ? = 0.05.) g. Instruct StatCrunch to save the 95% confidence intervals for the mean response. BUT DO NOT INCLUDE THE TABLE IN YOUR PROJECT. IT’S VERY BIG.   h. Use the table you created in part g to give the 95% confidence interval for the average ‘after reading’, when the ‘before reading’ is 60 bpm. i. Test to see if the ‘before reading’ and the ‘after reading’ are positively linearly correlated. (Use ? = 0.05.)

NOTE: Opinions may differ on whether or not the assumptions are met. For the sake of instruction, assume you can continue with the linear regression model to complete the project.

The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field, $129,100; Brown, $167,700; and Snow, $154,600. The operations did not go well, and the partners eventually decided to liquidate the partnership, sharing all losses equally. On May 31, after all assets were converted to cash and all creditors were paid, only $46,100 in partnership cash remained.

QS 12-9 Part 2

2. Assume that any partner with a deficit agrees to pay cash to the partnership to cover the deficit. Present the journal entries on May 31 to record (a) the cash receipt from the deficient partner(s) and (b) the final disbursement of cash to the partners.

Record the receipt of cash from the deficient partner(s).

Note: Enter debits before credits.

The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field, $129,100; Brown, $167,700; and Snow, $154,600. The operations did not go well, and the partners eventually decided to liquidate the partnership, sharing all losses equally. On May 31, after all assets were converted to cash and all creditors were paid, only $46,100 in partnership cash remained.

2. Assume that any partner with a deficit agrees to pay cash to the partnership to cover the deficit. Present the journal entries on May 31 to record (a) the cash receipt from the deficient partner(s) and (b) the final disbursement of cash to the partners.

Journal entry worksheet

Record the receipt of cash from the deficient partner(s).

Note: Enter debits before credits.

Toby agreed to build a hog confinement facility for Pork USA. The contract between Toby and Pork USA required: That work begin on or before May 1, 2016, weather permitting, or on the next day for which construction was practicable after that in the event of bad weather. The contract specified that time is of the essence to assure that the project was done before Fall. In fact, a freak spring snowstorm occurred on April 30, and Toby couldn't start construction until May 5. That Toby obtain a construction permit before any work could commence.That in order for Toby to obtain monthly construction payments, Toby would be required to submit inspection certificates from the county engineer's office. That once the construction certificate is present, payments would be issued immediately. That Toby will reduce the contract price by the amount of money it receives from a special state construction incentive program, provided Pork USA makes application to the state on or before June 1. Pork USA fails to make the necessary application.

Assume that Toby's delay in starting work made Pork USA doubt he was committed to the contract. Pork USA accuses Toby of a breach of contract and says the contract is cancelled, and demands that Toby return a $25,000 construction deposit paid by Pork USA. Toby doesn't  dispute that he breached the contract, but  claims that Pork USA owes him at least $25,000, since he spent a lot of time planning, arranging for workers, applying for permits, and ordering supplies. Will a court side with Pork USA or with Toby? Explain.

Below is the trial balance of Rod Ropes Ltd, year ending 31^st May 2020:

Notes: The following have not yet been reflected in the trial balance.

i) Inventory (stock) at 31/05/20 was valued at £260,000.

ii) Within administration expenses there is a prepayment of £3,000 that needs to be reflected.

iii) As at the 31/05/20 there was Marketing expenses owing of £5,000 that needs an accrual.

iv) Provision for doubtful debtors is to be 5% of outstanding trade receivables (debtors) as at

31/05/20.

v) Depreciation: Motor Vehicles, Reducing Balance Method 20% Fixtures and Fittings, Straight

Line Method 10%

vi) Tax on profit after interest of £30,000 has not yet been paid.

vii) Debenture interest has partly been paid however the remaining needs to be accrued for.

Additional note: There were no dividends paid during the year (interim) or due to be paid at the

end of the year.

(a) Prepare the Statement of Profit or Loss for the year ending 31st May 2020.

(b) Prepare the Statement of Financial Position as at 31st May 2020.

(c) Define and illustrate one (1) accounting concept that you have used in constructing the financial

statements above.

(d) State and briefly explain one (1) characteristic of what makes ‘good’ accounting information.

Ali, Khalid and Salim are partners of a firm (AKS LLC) that deals in used computer, printer, Xerox machines, servers, repair, and maintenance service in corporates and on call services. Everything was going well, but all in sudden Salim has been died in road accident. Salim’s wife appointed as the legal representatives to receive his share. Sharing profit and losses in the ratio of 5:3:2. Salim maintain all accounts like dealing and making final accounts and bank dealing. Due to Salim’s death it was difficult to collect all assets, liabilities and capital amount information because Khalid and Ali, they don’t have experiences to maintain the accounts. But at last they collect the below information but some information’s missing.

Being a friend of Ali, you will help to find out the missing information and Salim’s settlement in following condition.
Mr. Salim died on 31st March 2020. The legal representative of the deceased partner entitled to receive his share after the following adjustments.
a) Goodwill be valued at 2.5 year’s purchase of the average profit of the last four years, Which were 2016 OMR 32,500; 2017 OMR 30,000; 2018 OMR 40,000; 2019 OMR 37,500.
b) Premises to be appreciated by OMR 62,500.
c) Provision for doubtful debts to be made at 6% on debtor
d) The assets are to be valued as, Equipment be valued at OMR 70,000 and Patents at OMR 20,000.
e) For the purpose of calculating Salim’s share in the profit of 2020, the profit in 2020 should be taken to have been earned on the same as in 2019.
f) A sum of OMR15,000 is to be paid immediately to the executors of Salim and the balance transferred to his loan account.
You are required to pass necessary Journal entries with narrations to record the above transactions, prepare the Revaluation Account and Salim executors account

Kimble, Sykes, and Gerard open an accounting practice on January 1, 2019, in Chicago, Illinois, to be operated as a partnership. Kimble and Sykes will serve as the senior partners because of their years of experience. To establish the business, Kimble, Sykes, and Gerard contribute cash and other properties valued at $243,000, $197,500, and $109,500, respectively. An articles of partnership agreement is drawn up stipulating the following:

Personal drawings are allowed annually up to an amount equal to 10 percent of the partner's beginning capital balance for the year. Profits and losses are allocated according to the following plan:

1. Each partner receives an annual salary allowance of $55 per billable hours worked.

2. Interest is credited to the partners’ capital accounts at the rate of 12 percent of the beginning capital balance for the year.

3.Kimble and Sykes are eligible for an annual bonus of 10 percent of net income after subtracting the bonus, salary allowance, and interest. The agreement also states that there will be no bonus if there is a net loss or if salary and interest result in a negative remainder of net income to be distributed.

4.Any remaining partnership profit or loss is to be divided evenly among all partners.

On January 1, 2020, the partners admit Nichols to the partnership. Nichols contributes cash directly to the business in an amount equal to a 25 percent interest in the book value of the partnership property subsequent to this contribution. The partnership profit and loss sharing agreement is not altered upon Nichols' entrance into the firm; the general provisions continue to be applicable.

The billable hours for the partners during the first three years of operation follow:

2019 2020 2021

Kimble 2,540 1,800 1,880

Sykes 2,280 1,500 1,620

Gerard 2,140 1,380 1,310

Nichols 0 1,560 1,550

The partnership reports net income (loss) for 2019 through 2021 as follows: 2019 $ 303,000 2020 (14,500) 2021 498,000

Each partner withdraws the maximum allowable amount each year.

A.Prepare schedules that allocate each year's net income to the partners.

B.Prepare in appropriate form a statement of partners’ capital for the year ending December 31, 2021.

Bilbo Baggins wants to save money to meet three objectives. First, he would like to be able to retire 30 years from now with retirement income of $28,000 per month for 20 years, with the first payment received 30 years and 1 month from now. Second, he would like to purchase a cabin in Rivendell in 20 years at an estimated cost of $1,149,000. Third, after he passes on at the end of the 20 years of withdrawals, he would like to leave an inheritance of $550,000 to his nephew Frodo. He can afford to save $2,000 per month for the next 20 years.

If he can earn a 10 percent EAR before he retires and a 7 percent EAR after he retires, how much will he have to save each month in Years 21 through 30?

Say you owned a firm that held illiquid assets that you did not want to sell. The value of the firm is 100m dollars. Your firm had absolutely no debt. It also had no real future investment opportunities that it wanted to pursue. Assume you and your family needed a significant amount of cash for personal reasons. You approached a bank and they said they would give you a loan today of 40m dollars. The terms of the loarequired paying back 60m dollars after 4 years. So the bank gives the firm 40m dollars today. Explain what the firm would do with the money. What would the economic balance sheet look like after all the transactions have taken place. Explain why your ownership stake in the firm is lower than what it was before all these transactions took place.

Boston Cube Inc. currently has no debt, annual free cash flows of $74 million and an average tax rate of 34%. Free cash flows are expected to grow by 5% per year forever.

Using the CAPM, the firm estimates that its cost of equity is 12%. The risk-free rate is 2% and the expected equity market risk premium (MRP) is 7%. There are 8 million shares outstanding.

The firm is considering a new capital structure with a debt-to-capital ratio of 20%. The company would issue bonds to repurchase its own shares at the market price. An investment bank has estimated that the yield to maturity on the company's bonds would be 3%.

stock price before the recapitalization is 138.75

Part 2: What will be the WACC after the recapitalization?

Part 3: What will be the stock price after the recapitalization and how many shares will be outstanding at that price?