On January 1, 2019, Company X has an asset with a cost of $300,000 and accumulated

depreciation of $120,000. Estimated future cash inflows are $150,000 and the fair value

is $125,000. There is a 5-year remaining life and the company uses straight-line

depreciation. The asset will continue to be used in operations. At the beginning of

2020, Company X determines the fair value of the asset to be $160,000. Prepare entries

for 2019 and 2020.

IFRS: Assume the same facts except that Company X uses IFRS. Prepare the necessary

journal entries for 2019 and 2020.

An old covered wooden bridge can be reinforced at a cost of $12,000 (will last 18 years), or it can be replaced for $45,000 (will last 25 years). The present salvage value of the old bridge is $6,000. It is estimated that the reinforced bridge will last for 18 years, will have an annual cost of $500, and will have a salvage value of $6,000 at the end of 18 years. The salvage value of the new bridge after 25 years is $15,000. Maintenance for the new bridge would cost $100 annually. If the effective annual interest rate is 10%, which is the best alternative?

Please write a summary. The article about reasons for the rising Cost of Capital in China and found it both interesting and appropriate.

"Poor policy lies behind China’s rising cost of capitalBy Paul J Davies in Hong KongWealth management products are a slippery stepping stone China Development Bank is the core policy bank in China. It has more than Rmb6tn ($984bn) in assets, is wholly owned by the state and is as good for its money as the government itself. So when CDB is forced to slash the size of a proposed bond issue by 60 per cent, as happened this month, you can be sure something is not right in China’s credit markets.Other respected and credible companies have also been forced to delay or reduce bond issues, or pay more for their money. Take US-listed internet group Baidu. Last year, it sold a bond to US investors that was priced without the extra that emerging market borrowers usually pay. But in recent months, it struggled to get a Chinese bond away. China’s cost of capitalhas begun to rise even though the government seems some way from the liberalisation of deposit rates that has held down borrowing costs for so long. Banks must already pay more for funds in the interbank market. Meanwhile, wealth management products(WMPs) –short-term savings products sold mostly by banks to retail and institutional investors –and trust products continue to grow. Both are currently offering better returns than straight corporate bonds to all investors, including banks themselves. The issue here is less about the rising cost of money –which is inevitable as markets come toplay a “decisive” role in China, as the post-Plenumbuzzword has it –than it is about bad policy, or at least the consequences of slow policy.With financial reform, Beijing may be gracefully “crossing the river by feeling the stones” as advocated by late paramount leader Deng Xiaoping, but it is simultaneously turning a blind eye to jerry-rigged fording devices, like WMPs, just down stream. Plenty of ink has been spilled on the risks tied up in WMPs, but much less on what they are really there to do. Their role is to begin to allow market forces to affect the cost of money for banks and companies ahead of interest rate reform; WMPs also legitimise investments that have not yet been officially approved, or are banned in banking channels. They do this simply by being an intermediary, or wrapper around the banned products.Hence, they have been used to supply high-cost capital to property developers, as well as some state-owned enterprises after banks were told to stop lending to them. More recently, they have moved on to investing in hedge funds. Managers and their friends or family put up the first chunk of equity, then WMPs add up to four times that in leverage, say Shanghai hedge fundspecialists. This allows insurers, for example, to indirectly invest in funds that officially they should not. One of the great oddities in Chinese financial policy is that liberalisation happens as much negatively as positively. Companies like the financial arm of ecommerce group Alibaba have found that the way to develop products is often to start using them and see if someone tells you to stop. It can lend to small businesses but was warned away from early trials of consumer loans. Financial innovation is rarely given preapproval, bankers say. The industry is forced to “feel the stones” in the absence of clear policy. Surely Deng’s metaphor was about discovering what works, not what would gain official sanction.Viewed optimistically, WMPs have introduced a market for funding, lending and investing that ought to help banks and others learn to assess risks and to balance changeable costs and returns. However, their role in legitimising not yet sanctioned, or already banned, activities just adds to the inefficiency and costs in the distribution of Chinese capital. The power of each new yuan to generate economic growth is waning. The leakage of costs through extra layers of WMPs makes this worse. China’s cost of capital will rise, but it does not have to rise that much. Interest costs track gross domestic product growth rates, according to analysts at Bernstein Research. If China grows at 6-7 per cent for the next few years, new debt for good companies ought not to cost much more –so long as it is dispensed reasonably efficiently.For this to happen, the single most important reform would be market pricing of deposit rates. This will be dangerous for banks,as Jiang Jianqing, head of ICBC, China’s biggest bank, told the Financial Times recently: “If you do badly, you will be wiped out.”But finance keeps moving away from official channels –around one-fifth of credit was formed outside of banks in 2009; now that share has doubled, according to Bernstein. To protect the banks, Beijing must move slowly; but if it moves too slowly, good companies could be starved of reasonable funding –and it runs the risk that China’s financial river will end up clogged with the detritus of too many bad experiments outside the banks.Paul J Davies is Asia Finance Correspondent"

Please read it and share your thoughts. Write more than 400 words, and giving references.

Discuss the current U.S. labor situation as it relates to capital cost, productivity, and outsourcing and the new tariff imposed on imported steel. Relate your discussion to productivity, cost of labor, technology. Reference to the relative cost of labor compared to capital must be explicitly explained.

What term is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost, direct labor cost, and variable factory overhead cost?

a.Variable costing

b.Standard costing

c.Absorption costing

d.Differential costing

The level of inventory of a manufactured product has increased by 8,000 units during a period. The following data are also available:

What would be the effect on income from operations if variable costing is used rather than absorption costing?

a.$80,000 increase

b.$104,000 decrease

c.$104,000 increase

d.$80,000 decrease

A business operated at 100% of capacity during its first month and incurred the following costs:

If 1,600 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet?

a.$64,000

b.$66,400

c.$78,400

d.$56,000

Statement of Cost of Goods Manufactured and Income Statement for a Manufacturing Company

The following information is available for Shanika Company for 20Y6:

Required:

1. Prepare the 20Y6 statement of cost of goods manufactured.

2. Prepare the 20Y6 income statement.

Determine the effect on the cost of goods sold, total assets, and gross margin for 2013 and 2014 if the following inventory errors are not corrected. Indicate your answer with (+) for overstated, (-) for understated, and (0) for no effect.

a. Beginning inventory for 2013 is understated  b. Ending inventory for 2013 is overstated

Effect in 2013 on

Cost of Goods Sold ｜Total Assets｜ Gross Margin

a.

b.

Effect in 2014 on

Cost of Goods Sold ｜Total Assets ｜Gross Margin

a.

b.

Cough FX Limited reports the following shareholders' equity as of December 31, 2013:

Preferred shares, $5.00, authorized 100,000 shares, issued 80,000 shares $4,400,000

Common shares, authorized 200,000 shares, issued 150,000 shares, 146,000 outstanding $2,190,000

Retained earnings $3,400,000

   $9,990,000

Determine the following:

a. Assume the board of directors authorizes a 2-for-1 split on the common shares. Calculate the number of shares outstanding after the split and the book value of both classes of shares.

b. Assume the board of directors authorizes a 15% stock dividend on the common shares after the stock split. The current selling price of the common shares is $9. Prepare the journal entry to distribute the stock dividend.

1. What model of electoral choice in the United States reduces the information cost of voting the most?
2. According to Stone (2017), why has the incumbency advantage declined in contemporary congressional elections? What are the implications of this decline incumbent officeholders hold over their non-incumbent challengers for the role of partisanship in American elections?

Dog Up! Franks is looking at a new sausage system with an installed cost of $509085. This cost will be depreciated straight-line to zero over the project's five-year life, at the end of which the sausage system can be scrapped for $75109. The sausage system will save the firm $205155 per year in pretax operating costs, and the system requires an initial investment in net working capital of $32364. If the tax rate is 31 percent and the discount rate is 9 percent, what is the NPV of this project? (Do not round intermediate calculations and round your final answer to the nearest dollar amount. Omit the "$" sign and commas in your response. For example, $123,456.78 should be entered as 123457.)

Use the following information to determine the changes in the following: cost of service failures (including invoice discount, rehandling cost, lost sales), net income, and Return on Assets.

Order fill increases from 92% to 98% with an average inventory increase of 25% and a 20

% increase in both warehousing and transportation costs.

Average price per order                                     $250

Gross margin per order                                      $87

Annual orders                                                   250,000

Of orders not filled correctly, 80% may be rectified with an invoice discount of $100 and additional handling per rectified order of $35

Cash                                                                 $5,000,000

Accounts receivable                                          $3,490,000

Fixed assets                                                      $120,000,000

Warehousing cost                                              $1,000,000

Other operating costs                                         $1,200,000

Tax rate                                                            20% of (EBIT-interest)

Transportation cost                                           $800,000

Average inventory                                            $2,000,000

Interest cost                                                      $400,000

Inventory carrying cost                                      10% per year

ABC Company is considering a move to outsource is warehousing operations. Current financial information is shown below.

Sales                                                               $500,000

Transportation cost                                          $15,000

Warehousing cost                                            $10,000

Inventory carrying cost                                    18%

Cost of goods sold                                           $325,000

Other operating costs                                       $95,000

Average inventory                                           $50,000

Accounts receivable                                         $30,000

Cash                                                               $15,000

Net fixed assets                                               $850,000

Interest                                                           $10,000

Taxes                                                              20% of (EBIT – Interest)

As a result of outsourcing warehousing the following changes will occur.

Net fixed assets reduced                                   15%

Inventory reduced                                            15%

Warehousing costs                                           $0

Outsourcing provider costs                               $20,000

            Determine the effect on ROA if warehousing is outsourced.