Question & Answer

1. Why may inflows of short-term deposits create a problem? 2. Where would interest payments on short-term foreign deposits in UK banks be entered on the balance of payments account?

What is a machining center?

Fixed, variable, and mixed costs Bridges and Roads is an entity engaged in road construction. Some selected items from its chart of accounts are listed below.   Required For each account, indicate whether the account represents a fixed, variable, or mixed cost for the operation of road construction activity. If mixed, indicate whether it is predominantly fixed or variable. Explain your answers.   (a) Staff wages (f) Office supplies (b) Clerical wages (g) Professional dues (c) Rent (h) Professinal subscriptions (d) Licences (i) Property taxes (e) Insurance (j) Advertising   (LO2)   [Note about problem complexity: These are difficult questions because students will need to first visualise the costs (with very little information) and then apply chapter concepts. The Step 2 questions (A, B, and F) are the ones requiring significant assumptions to generate an answer.]

Explain whether a corporation’s assumption of shareholder liabilities will always constitute boot in a §351 transaction.

With reference to the above, provide an assessment of the UK balance of payments in 2020.

1.       : Discuss some of the potential positive and negative aspects of sending digital nudges to managers via e-mail or text messages. What do you see as the most important ways for managers to use this technology?

What is the definition of fair value?

What is a polymer?

What policy prescriptions could be recommended for an economy experiencing a balance sheet recession?

Thinken Technology recently merged with College Electronix (CE), a computer graphics manufacturing firm. In performing a comprehensive audit of CE’s accounting system, Gerald Ott, internal audit manager for Thinken Technology, discovered that the new subsidiary did not record pension assets and liabilities, subject to GAAP. The net present value of CE’s pension assets was $15.5 million, the vested benefit obligation was $12.9 million, and the projected benefit obligation was $17.4 million. Ott reported this audit finding to Julie Habbe, the newly appointed controller of CE. A few days later, Habbe called Ott for his advice on what to do. Habbe started her conversation by asking, “Can’t we eliminate the negative income effect of our pension dilemma simply by terminating the employment of nonvested employees before the end of our fiscal year?” Instructions How should Ott respond to Habbe’s remark about firing nonvested employees?

Franklin Corp. has an investment that it has held for several years. When it purchased the investment, Franklin classified and accounted for it as available-for-sale. Can Franklin use the fair value option for this investment? Explain.

What is a rivet?

1.      : Ignore the test. Cheryl has proved herself via work experience and deserves the job.

The trial balance of Blues Traveler Corporation does not balance.   An examination of the ledger shows these errors. 1. Cash received from a customer on account was recorded (both debit and credit) as $1,380 instead of $1,830. 2. The purchase on account of a computer costing $3,200 was recorded as a debit to Office Expense and a credit to Accounts Payable. 3. Services were performed on account for a client, $2,250, for which Accounts Receivable was debited $2,250 and Service Revenue was credited $225. 4. A payment of $95 for telephone charges was entered as a debit to Office Expense and a debit to Cash. 5. The Service Revenue account was totaled at $5,200 instead of $5,280. Instructions From this information prepare a corrected trial balance.

The power source in a particular welding operation generates 125 Btu/min, which is transferred to the work surface with heat transfer factor = 0.8. The melting point for the metal to be welded = 1800°F and its melting factor = 0.5. A continuous fillet weld is to be made with a cross-sectional area = 0.04 in2. Determine the travel speed at which the welding operation can be accomplished.

Hamilton Construction Company uses the percentage-of-completion method of accounting. In 2014, Hamilton began work under contract #E2-D2, which provided for a contract price of $2,200,000. Other details follow: 2014 2015 Costs incurred during the year $640,000 $1,425,000 Estimated costs to complete, as of December 31 960,000 –0– Billings during the year 420,000 1,680,000 Collections during the year 350,000 1,500,000 Instructions (a) What portion of the total contract price would be recognized as revenue in 2014? In 2015? (b) Assuming the same facts as those above except that Hamilton uses the completed-contract method of accounting, what portion of the total contract price would be recognized as revenue in 2015? (c) Prepare a complete set of journal entries for 2014 (using the percentage-of-completion method).

What would be the classical economists’ criticisms of this argument?

A prototype of a tube with a square cross section is to be fabricated using stereolithography. The outside dimension of the square = 100 mm and the inside dimension = 90 mm (wall thickness = 5 mm except at corners). The height of the tube (z-direction) = 80 mm. Layer thickness = 0.10 mm. The diameter of the laser beam (“spot size”) = 0.25 mm, and the beam is moved across the surface of the photopolymer at a velocity of 500 mm/s. Compute an estimate for the time required to build the part, if 10 s are lost each layer to lower the height of the platform that holds the part. Neglect the time for postcuring.

As the new staff person in your company’s treasury department, you have been asked to conduct research related to a proposed transfer of receivables. Your supervisor wants the authoritative sources for the following items that are discussed in the securitization agreement. Instructions If your school has a subscription to the FASB Codification, go to http://aaahq.org/asclogin.cfm to log in and prepare responses to the following. Provide Codification references for your responses. (a) Identify relevant Codification section that addresses transfers of receivables. (b) What are the objectives for reporting transfers of receivables? (c) Provide definitions for the following: (1) Transfer. (2) Recourse. (3) Collateral. (d) Provide other examples (besides recourse and collateral) that qualify as continuing involvement.

What is meant by hysteresis when applied to unemployment? How do you account for this phenomenon in the 1980s?

This year Lloyd, a single taxpayer, estimates that his tax liability will be $10,000.  Last year, his total tax liability was $15,000.  He estimates that his tax withholding from his employer will be $7,800.   a. Is Lloyd required to increase his withholding or make estimated tax payments this year to avoid the underpayment penalty?  If so, how much?

1. It is sometimes claimed that the market for various stocks and shares is perfectly competitive, or nearly so. Take the case of the market for shares in a large company like Apple. Go through each of the four assumptions above and see if they apply in this case. (Don’t be misled by assumption (1). The ‘firm’ in this case is not Apple itself.) 2. Is the market for gold perfectly competitive?

The stockholders’ equity section of Martino Inc. at the beginning of the current year appears below. Common stock, $10 par value, authorized 1,000,000 shares, 300,000 shares issued and outstanding $3,000,000 Paid-in capital in excess of par—common stock 600,000 Retained earnings 570,000 During the current year, the following transactions occurred. 1. The company issued to the stockholders 100,000 rights. Ten rights are needed to buy one share of stock at $32. The rights were void after 30 days. The market price of the stock at this time was $34 per share. 2. The company sold to the public a $200,000, 10% bond issue at 104. The company also issued with each $100 bond one detachable stock purchase warrant, which provided for the purchase of common stock at $30 per share. Shortly after issuance, similar bonds without warrants were selling at 96 and the warrants at $8. 3. All but 5,000 of the rights issued in (1) were exercised in 30 days. 4. At the end of the year, 80% of the warrants in (2) had been exercised, and the remaining were outstanding and in good standing. 5. During the current year, the company granted stock options for 10,000 shares of common stock to company executives. The company, using a fair value option-pricing model, determines that each option is worth $10. The option price is $30. The options were to expire at year-end and were considered compensation for the current year. 6. All but 1,000 shares related to the stock-option plan were exercised by year-end. The expiration resulted because one of the executives failed to fulfill an obligation related to the employment contract. Instructions (a) Prepare general journal entries for the current year to record the transactions listed above. (b) Prepare the stockholders’ equity section of the balance sheet at the end of the current year. Assume that retained earnings at the end of the current year is $750,000.

Explain the meaning of the following terms: (a) commonsize analysis, (b) vertical analysis, (c) horizontal analysis, and (d) percentage analysis.

Suppose you asked your favorite AI query tool the following question: “What is the Kiddie Tax?”  The AI tool provided the following response: