Question & Answer

Morlan Corporation is preparing its December 31, 2014, financial statements. Two events that occurred between December 31, 2014, and March 10, 2015, when the statements were issued, are described below. 1. A liability, estimated at $160,000 at December 31, 2014, was settled on February 26, 2015, at $170,000. 2. A flood loss of $80,000 occurred on March 1, 2015. What effect do these subsequent events have on 2014 net income?

1.      : Instruct Rukman participants to reveal their participation in the corporate marketing program only if directly asked by the person they are talking to about the client’s products.

Adams Inc. will deposit $30,000 in a 12% fund at the end of each year for 8 years beginning December 31, 2014. What amount will be in the fund immediately after the last deposit?

Fill in the missing figures in the Table 6.3. (Note that the figures for MC come in the spaces between each level of output.)

Remuneration disclosure The ASX Corporate Governance Principles and Recommendations set out rules to deal with enhanced management performance and effectiveness and requires disclosure of the process for performance evaluation of the board, its committees and individual directors and key executives. However, the outcomes of individual evaluations are not required to be disclosed.   Required Why do you think such a recommendation is included in the guidelines? (LO5)

What distinguishes operating from liquidating distributions?

Absent any special elections, what effect does a sale of partnership interest have on the partnership?

An electron-beam welding operation is to be accomplished to butt weld two sheet-metal parts that are 3.0 mm thick. The unit melting energy = 5.0 J/mm3. The weld joint is to be 0.35 mm wide, so that the cross section of the fused metal is 0.35 mm by 3.0 mm. If accelerating voltage = 25 kV, beam current = 30 milliamp, heat transfer factor f1 = 0.85, and melting factor f2 = 0.75, determine the travel speed at which this weld can be made along the seam

What is the difference between a pattern and a core in sand molding?

A motor vehicle assembly plant closes every August to retool for the next year’s model. How should August’s cost data be used in estimating the overhead cost function?

Reese, a calendar-year taxpayer, uses the cash method of accounting for her sole proprietorship. In late December, she received a $20,000 bill from her accountant for consulting services related to her small business. Reese can pay the $20,000 bill any time before January 30 of next year without penalty. Assume Reese’s marginal tax rate is 32 percent this year and will be 37 percent next year, and that she can earn an after-tax rate of return of 12 percent on her investments. When should she pay the $20,000 bill—this year or next?

1.    : Is it reasonable to expect that managers can measure their social and environmental performance on the same level as they measure financial performance with a triple bottom line? Discuss.

Mohave Inc. purchased land, building, and equipment from Laguna Corporation for a cash payment of $315,000. The estimated fair values of the assets are land $60,000, building $220,000, and equipment $80,000. At what amounts should each of the three assets be recorded?

Presented below is a schedule of property dispositions for Hollerith Co.   The following additional information is available. Land: On February 15, a condemnation award was received as consideration for unimproved land held primarily as an investment, and on March 31, another parcel of unimproved land to be held as an investment was purchased at a cost of $35,000. Building: On April 2, land and building were purchased at a total cost of $75,000, of which 20% was allocated to the building on the corporate books. The real estate was acquired with the intention of demolishing the building, and this was accomplished during the month of November. Cash proceeds received in November represent the net proceeds from demolition of the building. Warehouse: On June 30, the warehouse was destroyed by fire. The warehouse was purchased January 2, 2011, and had depreciated $16,000. On December 27, the insurance proceeds and other funds were used to purchase a replacement warehouse at a cost of $90,000. Machine: On December 26, the machine was exchanged for another machine having a fair value of $6,300 and cash of $900 was received. (The exchange lacks commercial substance.) Furniture: On August 15, furniture was contributed to a qualified charitable organization. No other contributions were made or pledged during the year. Automobile: On November 3, the automobile was sold to Jared Winger, a stockholder. Instructions Indicate how these items would be reported on the income statement of Hollerith Co.

Why would the adjustable peg system have been less suitable in the world of the mid-1970s than it was back in the 1950s?

When stock market volatility is high, corporate bond yields tend to increase. Which market forces cause the increase in corporate bond yields under these conditions? (LO2)

A leadscrew connected directly to a DC servomotor is the drive system for a positioning table. The leadscrew pitch = 4 mm. The optical encoder attached to the leadscrew emits 250 pulses/rev of the leadscrew. Determine (a) the control resolution of the system, expressed in linear travel distance of the table axis, (b) the frequency of the pulse train emitted by the optical encoder when the servomotor operates at 14 rev/s, and (c) the travel speed of the table at the operating speed of the motor.

Differentiate between the direct method and the indirect method by discussing each method.

A product is made to stock. Annual demand is 86,000 units. Each unit costs $9.50 and the annual holding cost rate is 22%. Setup cost to produce this product is $800. Determine (a) economic order quantity and (b) total inventory costs for this situation.

With reference to Table 4.1, determine the increase in length of a steel bar whose length = 10.0 in, if the bar is heated from room temperature of 70°F to 500°F.

Presented below is financial information for two different companies. Alatorre Company Eduardo Company Sales revenue $90,000 (d) Sales returns and allowances (a) $ 5,000 Net sales 81,000 95,000 Cost of goods sold 56,000 (e) Gross profi t (b) 38,000 Operating expenses 15,000 23,000 Net income (c) Instructions Compute the missing amounts.

The accounting staff of Usher Inc. has prepared the following pension worksheet. Unfortunately, several entries in the worksheet are not decipherable. The company has asked your assistance in completing the worksheet and completing the accounting tasks related to the pension plan for 2014.   Instructions (a) Determine the missing amounts in the 2014 pension worksheet, indicating whether the amounts are debits or credits. (b) Prepare the journal entry to record 2014 pension expense for Usher Inc. (c) The accounting staff has heard of a pension accounting procedure called “corridor amortization.” Is Usher required to record any amounts for corridor amortization in (1) 2014? In (2) 2015? Explain.

Since 2008, the UK government has provided free off-peak bus travel for the over-60s in England and Wales. What do you think the impact of this policy has been on car usage? Is there a case for extending the policy to (a) bus travel for pensioners at all times of the day, as is the case in Scotland (b) bus travel for all?

During its first year of operations, Collin Raye Corporation had the following transactions pertaining to its common stock. Jan. 10 Issued 80,000 shares for cash at $6 per share. Mar. 1 Issued 5,000 shares to attorneys in payment of a bill for $35,000 for services rendered in helping the company to incorporate. July 1 Issued 30,000 shares for cash at $8 per share. Sept. 1 Issued 60,000 shares for cash at $10 per share. Instructions (a) Prepare the journal entries for these transactions, assuming that the common stock has a par value of $5 per share. (b) Prepare the journal entries for these transactions, assuming that the common stock is no-par with a stated value of $3 per share.

Use the information provided in IFRS12-8. Assume that the recoverable amount of the division is estimated to be $750,000. Prepare Waters’ journal entry, if necessary, to record impairment of the goodwill.