2.3. Each of the following scenarios presents a claim by a researcher. Assume that the sample sizes in each case was in the range of 20 to 25 observations per sample in each case. Answer the following for each scenario:

(i) state the appropriate null (HO) and alternate hypothesis (HA) in symbolic form (e.g. Hx : Meanleft = Meanright);

(ii) indicate whether it is a 1or 2-tailed test, and if a 1-tailed tests which tail is the area of rejection at.

A. Outside of the nesting season, male and female Robins do not differ in weight. An ornithologist thought however that females gained extra weight prior to nesting. She captured and weighed 20 adult females (F) and 22 males (M) from the same location just as they were started to build nests.wanted to know if this was also true during the nesting season.

B. A resident of Peterborough thinks the city is unusual in that the north end of the city (near Trent University) gets less rainfall than the south end (of the city (near Peterborough Airport). Data were collected for all rain events greater than 4 mm from weather stations at the University (TU) and the airport (PA) from April 1 to November 30 2019.

C. Whether the intensity of rain events (cm/hr) in August (AUG) differ from those in May (MAY) in Peterborough county.

D. A Professor wonders whether it is true that students actually spend more time (hours per week) on course work (ie “attending lectures” and doing assignments) in his online course(ON) compared to the same course taught face-to-face (F2F) in the same semester. He surveyed 25 students from each of the two courses.

theory 1

The ancestors of giraffes had short necks, and there was great competition for the plant food near the ground. Some of the giraffes kept trying to stretch their necks to reach leaves higher in the trees. As they stretched and stretched, their necks became longer. As their necks became longer, they were able to reach more food. Those ancestral giraffes survived to reproduce, while the giraffes that had not stretched their necks died. The offspring of giraffes with stretched necks inherited the longer necks. This process continued for generation after generation. In this way, giraffes evolved with longer and longer necks.

Theory 2

The ancestors of giraffes had short necks, and there was great competition for the plant food near the ground. Some of the ancestral giraffes naturally had slightly longer necks than others. The individuals with longer necks could reach leaves higher up in trees, and therefore could eat more food. Because those ancestral giraffes ate more food, they survived to produce offspring while the individuals with shorter necks did not. The offspring of giraffes with longer necks inherited the longer necks. This process continued for generation after generation. In this way, giraffes evolved with longer and longer necks.

a. In Theory 1, what caused the giraffe neck to become longer?

b. In Theory 2, what caused the giraffe neck to become longer?

c. According to what scientists now know about genes, could the giraffes’ offspring have inherited longer necks as described in Theory 1? Explain.

d. According to what scientists now know about genes, could the giraffes’ offspring have inherited longer necks as described in Theory 2? Explain.

e. Which of the two theories matches Darwin’s theory of evolution? Explain.

Political parties want to know what groups of people support them. The General Social Survey (GSS) asked its 2014 sample, "Generally speaking, do you usually think of yourself as a Republican, Democrat, Independent, or what?" The GSS is essentially an SRS of American adults. Here is a large two-way tale breaking down the responses by the highest degree the subject held:

1. Make a 2x5 table by combining the counts in the three rows that mention Democrats, Republicans and ignoring strict independents and supporters of other parties. We might think of this table as comparing all adults who lean Democrat or Republican. How does does support for the two major parties differ among adults with different levels of education?

2. Use the full table to analyze the differences in political party support among levels of education. The sample is so large that the differences are bound to be highly significant. but give the χ2χ2 test statistic and p-value nonetheless. The main challenge is in seeing what the data say. Does the full table yield any insights not found in the compressed table analyzed in part 1?

Political parties want to know what groups of people support them. The General Social Survey (GSS) asked its 2014 sample, "Generally speaking, do you usually think of yourself as a Republican, Democrat, Independent, or what?" The GSS is essentially an SRS of American adults. Here is a large two-way tale breaking down the responses by the highest degree the subject held:

1. Make a 2x5 table by combining the counts in the three rows that mention Democrats, Republicans and ignoring strict independents and supporters of other parties. We might think of this table as comparing all adults who lean Democrat or Republican. How does does support for the two major parties differ among adults with different levels of education?

2. Use the full table to analyze the differences in political party support among levels of education. The sample is so large that the differences are bound to be highly significant. but give the χ2χ2 test statistic and p-value nonetheless. The main challenge is in seeing what the data say. Does the full table yield any insights not found in the compressed table analyzed in part 1?

Homework Assignment III (Due on May3, 2018)

• Answer All Questions

• Show all your work (use of formula, etc.) in solving the problems. You still need to show your work even if you use the financial calculator to get the answers. (Please show all work and do not use excel)

1. Drill Mart Inc. is considering a new product launch. The project will cost $1,200,000 have a eight-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 24,000 units per year; price per unit will be $250, variable costs per unit will be $150 and fixed costs will be $400,000 per year. The required return on the project is 14 percent, and tax rate = 0% (i.e., ignore taxes). a. What is the accounting break-even level of output for this project? b. Find the firm’s operating cash flow (OCF) if the firm just breaks-even on an accounting basis (that is, at Q = accounting break-even level).   c. What is the cash break-even level of output for this project? d. How many units, at a minimum, must Drill Mart sell before the project’s NPV becomes negative? e. The marketing department of Drill Mart reports the annual expected sales of 7,000 units. Shall Drill Mart accept this project? Why? Calculate NPV and IRR at this level of sales (7,000 units).

2. At an output level of 2,000 units, you calculate that the degree of operating leverage is 3. Fixed costs are $35,000. (a) If output rises to 2,500 units, calculate the percentage change in OCF, new OCF and new DOL. (b) If output falls to 1,500 units, calculate the percentage change in OCF, new OCF and new DOL. (hint: start by finding the OCF at 2,000 units using DOL equation of 1+ FC/OCF)

3. Forrest Corporation has 500,000 shares of common stock, 10,000 shares of preferred stock, and 5,000 bonds with 8 percent (coupon) outstanding. The common stock currently sells for $25 per share and has a beta of 0.95. Preferred stocks pay a dividend of $8 per share and currently sell for $98 with a floatation cost of $2 per share. The bonds have par value of $1,000, 20 years to maturity, currently sell for 102.5 percent of par, and the coupons are paid semiannually. The bond’s floatation cost is 1% of the current market price. The expected return on market portfolio is 9 percent, T-bills are yielding 2 percent, and the tax rate is 35 percent. What is the firm’s market value capital structure? If Forrest is evaluating a new investment project that has the same risk as the firm’s typical project, what rate should the firm use to discount the project’s cash flows?

4. Finance, Inc., currently has no debt outstanding and has a total market value (equity) of $200,000. EBIT is projected to be $15,000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 40 percent higher. If there is a recession, then EBIT will be 50 percent lower. Finance is considering a $60,000 debt issue with a 7 percent interest rate. The proceeds will be used to repurchase shares of stock. There are currently 10,000 shares outstanding. Ignore taxes. a. Calculate earnings per share, EPS, under each of the 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 Finance goes through with recapitalization. What do you observe? (Explain it in terms of percentage change in EPS in both cases: without debt and with debt) c. Find the break-even EBIT. Find the EPS under both cases at break-even EBIT.

Which of the following statements is true?

3 points   

QUESTION 12

What guideline should be used in determining whether a joint product should be sold at the split-off point or processed further?

3 points   

QUESTION 13

Frank's Drapery Cleaning is estimating the following sales figures for the next four months:

Frank has the following collection pattern on credit sales: 60% in month of sale; 30% in month after sale; 10% in second month after sale. What are Frank's budgeted cash receipts for March?

4 points   

QUESTION 14

Kathy's budgeted production figures (in units) for sweatshirts for next quarter are shown below:

July August September

Budgeted production 3,600 4,100 5,000

Kathy uses 1.2 yards of fabric per sweatshirt and pays $0.75 per yard. Kathy likes to have half of the next month's fabric needs in ending inventory. What is the expected cost of fabric to be purchased in August?

4 points   

QUESTION 15

The following information is from the October cash budget of Daniel's Pet Accessories Shop:

Excess of Cash available over disbursements $800

Cash Balance on Oct. 1 $10,100

Total Cash Disbursements $32,500

Daniel is required to maintain a minimum cash balance of $10,000, how much money should he plan to borrow in October?

4 points   

QUESTION 16

The following information is available for Park Corporation for the month of July:

Cash collections $63,800

Dividends paid in July $4,000

Selling expenses $33,400

Administrative expenses $29,000

Depreciation expense on equipment $2,000

Cash Balances July 1 $900

Park does not have any accounts receivable or accounts payable. What will be the amount of cash disbursements for the month of July and the excess or deficiency of cash for the month of July, respectively?

Cost Estimation; High-low Method; MAPE: Horton Manufacturing Inc. produces blinds and other window treatments for residential homes and offices. The owner is concerned about the maintenance costs for the production machinery because maintenance costs for the previous fiscal year were higher than he expected. The owner has asked you to assist in estimating future maintenance costs to better predict the firm's profitability. Together, you have determined that the best cost driver for maintenance costs is machine hours. The data from the previous fiscal year for maintenance costs and machine hours follow:

Question:

- Use the high-low method to estimate the fixed and variable portions for maintenance costs.

- Graph the data points to check for possible outliers and determine whether the points selected in requirement 1 are representative of the date.

- Calculate the mean absolute percentage average error (MAPE) for the cost equation you developed in requirement 1.

Sunny Beach Resort is a family-friendly budget resort. Management has projected 14,800 room rentals for the year, based on the 60-room resort. The capital invested in the motel is $1,500,000. The target return on investment is 20%. The resort, in an effort to earn the target return on investment, plans to price the rooms at full price plus a markup.

Using data below

1. What price should Sunny Beach charge for a single room rental per night? What is the markup
   as a percentage of the full cost of a single room rental per night?
2. Market research indicates that if the price of a room-night determined in requirement 1 is reduced by 10%, the expected number of room-nights Sunny Beach could rent would increase by 10%. Should they reduce prices by 10%? Show your calculations.

---------------------------------

Sunny Beach Resort is a family friendly budget resort. Management has projected 14,800 room rentals for the year based on the 60-room resort.

The capital invested in the motel is $1,500,000. The target return on investment is 20%. Sunny Beach plans to price the rooms at full cost plus a markup on full cost to earn the target return on investment.

2. Krishna Electronics Pvt. Ltd. is a new venture that manufactures electronic components. The company produced the following income statement results in its first year of operations:

Cost of Goods Sold are expected to vary with sales and are expected to be a constant percentage of sales. The General and Administrative expenses are expected to be a fixed cost. Further Marketing Expenses are also expected to remain fixed because the sales staff are on fixed salaries and no new hiring is planned. The selling price for the electronic component (manufactured by the company) is Rs. 20 per unit. The effective tax rate is expected to be 30% (when the firm is profitable.)

1. Calculate the survival (i.e. EBDAT) breakeven point for Krishna Electronics in terms of survival revenues (Rs.)   
2. Calculate the EBDAT breakeven point in terms of number of units sold.
3. Calculate the NOPAT breakeven point for Krishna Electronics in terms of revenues (in Rupees.)
4. Calculate the NOPAT breakeven point in terms of number of units sold.   

Parent Company owns a controlling share of Subsidiary company's common stock. During 2017 and 2018, Parent sold inventory to Subsidiary company. The sales and cost of sales information are detailed below. There were no intercompany sales prior to 2017. In both 2017 and 2018, Subsidiary sold 80% of the intercompany inventory purchased in that year. In 2018, all the beginning inventory was sold first.

Ownership Percentage 75%

2017 intercompany sales $550,000

2018 intercompany sales $470,000

2017 Cost of Goods Sold $350,000

2018 Cost of Goods Sold $310,000

A) Record all 2017 elimination entries necessary due to the inventory transactions.

B) Record all 2018 elimination entries necessary due to the inventory transactions.

I think I know the entries so far, but getting the numbers is what is tripping me up.

For 2017 entries:

Debit Sales, Credit COGS then Debit COGS Credit Inventory - Bal Sheet

And for 2018.... Debit Beg R/E and Credit COGS (and then Debit Sales Credit COGS and Debit COGS and Credit Inventory???)

A little confused here... I think because the wording is different than the questions my professor went over in the powerpoint. Any help is appreciated. Thanks in advance!