Question & Answer

A metal alloy has been tested in a tensile test with the following results for the flow curve parameters: strength coefficient = 620.5 MPa and strain-hardening exponent = 0.26. The same metal is now tested in a compression test in which the starting height of the specimen = 62.5 mm and its diameter = 25 mm. Assuming that the cross section increases uniformly, determine the load required to compress the specimen to a height of (a) 50 mm and (b) 37.5 mm.

A hot rolling mill has rolls of diameter = 24 in. It can exert a maximum force = 400,000 lb. The mill has a maximum horsepower = 100 hp. It is desired to reduce a 1.5 in thick plate by the maximumpossible draft in one pass. The starting plate is 10 in wide. In the heated condition, the work material has a strength coefficient = 20,000 lb/in2 and a strain hardening exponent = zero. Determine (a) maximum possible draft, (b) associated true strain, and (c) maximum speed of the rolls for the operation

Compare the relative merits of targeting (a) the money supply; (b) the exchange rate; (c) the rate of inflation.

Explain the exchange rate system that existed during the 1950s and 1960s. How did the Smithsonian Agreement in 1971 revise it? How does today’s exchange rate system differ from the earlier system? (LO1)

Can we incorporate trade effects into endogenous growth models?

Presented below is information related to the Accounts Receivable accounts of Gulistan Inc. during the current year 2014. 1. An aging schedule of the accounts receivable as of December 31, 2014, is as follows. % to Be Applied after Age Net Debit Balance Correction Is Made Under 60 days $172,342 1% 60–90 days 136,490 3% 91–120 days 39,924* 6% Over 120 days 23,644 $3,700 defi nitely uncollectible; $372,400 estimated remainder uncollectible is 25% *The $3,240 write-off of receivables is related to the 91-to-120 day category. 2. The Accounts Receivable control account has a debit balance of $372,400 on December 31, 2014. 3. Two entries were made in the Bad Debt Expense account during the year: (1) a debit on December 31 for the amount credited to Allowance for Doubtful Accounts, and (2) a credit for $3,240 on November 3, 2014, and a debit to Allowance for Doubtful Accounts because of a bankruptcy. 4. Allowance for Doubtful Accounts is as follows for 2014.   5. A credit balance exists in Accounts Receivable (60–90 days) of $4,840, which represents an advance on a sales contract. Instructions Assuming that the books have not been closed for 2014, make the necessary correcting entries

Johnny Football Shop began operations on January 2, 2014. The following stock record card for footballs was taken from the records at the end of the year. Units Unit Invoice Gross Invoice Date Voucher Terms Received Cost Amount 1/15 10624 Net 30 50 $20 $1,000 3/15 11437 1/5, net 30 65 16 1,040 6/20 21332 1/10, net 30 90 15 1,350 9/12 27644 1/10, net 30 84 12 1,008 11/24 31269 1/10, net 30 76 11 836 Totals 365 $5,234 A physical inventory on December 31, 2014, reveals that 100 footballs were in stock. The bookkeeper informs you that all the discounts were taken. Assume that Johnny Football Shop uses the invoice price less discount for recording purchases. Instructions (a) Compute the December 31, 2014, inventory using the FIFO method. (b) Compute the 2014 cost of goods sold using the LIFO method. (c) What method would you recommend to the owner to minimize income taxes in 2014, using the inventory information for footballs as a guide?

What led to the establishment of FDIC insurance? (LO2)

A manual assembly line has 17 workstations with one operator per station. Total work content time to assemble the product = 22.2 minutes. The production rate of the line = 36 units per hour. A synchronous transfer system is used to advance the products from one station to the next, and the transfer time = 6 seconds. The workers remain seated along the line. Proportion uptime = 0.90. Determine the balance efficiency.

What is goodwill? What is a bargain purchase?

Allocating support costs to units A local hospital is required to account for the total cost of patient care, including support costs. Patients are assigned all direct costs. Support costs are $240 000 per month plus $90 per patient day. This 120-bed hospital averages 80 per cent occupancy.   Required (a)   Calculate the average daily charge per patient for support costs, assuming 30 days in a month. (b)   Briefly comment on potential problems in using only one indirect cost pool for support costs given that individual patients receive a range of different treatments while an inpatient.

Norman’s Televisions produces television sets in three categories: portable, midsize, and flat-screen. On January 1, 2014, Norman adopted dollar-value LIFO and decided to use a single inventory pool. The company’s January 1 inventory consists of: Category Quantity Cost per Unit Total Cost Portable 6,000 $100 $ 600,000 Midsize 8,000 250 2,000,000 Flat-screen 3,000 400 1,200,000 17,000 $3,800,000 During 2014, the company had the following purchases and sales. Quantity Quantity Selling Price Category Purchased Cost per Unit Sold per Unit Portable 15,000 $110 14,000 $150 Midsize 20,000 300 24,000 405 Flat-screen 10,000 500 6,000 600 45,000 44,000 Instructions (Round to four decimals.) (a) Compute ending inventory, cost of goods sold, and gross profit. (b) Assume the company uses three inventory pools instead of one. Repeat instruction (a).

In writing a research memo, what types of facts should be included in the memo?

Summarise this last paragraph using symbols like those in Figure 1.7.

Parent Co. invested $1,000,000 in Sub Co. for 25% of its outstanding stock. Sub Co. pays out 40% of net income in dividends each year. Instructions Use the information in the following T-account for the investment in Sub to answer the following questions. Investment in Sub Co. 1,000,000 110,000 44,000 (a) How much was Parent Co.’s share of Sub Co.’s net income for the year? (b) How much was Parent Co.’s share of Sub Co.’s dividends for the year? (c) What was Sub Co.’s total net income for the year? (d) What was Sub Co.’s total dividends for the year?

On January 1, 2014, Bonanza Wholesalers Inc. adopted the dollar-value LIFO inventory method for income tax and external financial reporting purposes. However, Bonanza continued to use the FIFO inventory method for internal accounting and management purposes. In applying the LIFO method, Bonanza uses internal conversion price indexes and the multiple pools approach under which substantially identical inventory items are grouped into LIFO inventory pools. The following data were available for inventory pool no. 1, which comprises products A and B, for the 2 years following the adoption of LIFO. FIFO Basis per Records Unit Total Units Cost Cost Inventory, 1/1/14 Product A 10,000 $30 $300,000 Product B 9,000 25 225,000 $525,000 Inventory, 12/31/14 Product A 17,000 36 $612,000 Product B 9,000 26 234,000 $846,000 Inventory, 12/31/15 Product A 13,000 40 $520,000 Product B 10,000 32 320,000 $840,000 Instructions (a) Prepare a schedule to compute the internal conversion price indexes for 2014 and 2015. Round indexes to two decimal places. (b) Prepare a schedule to compute the inventory amounts at December 31, 2014 and 2015, using the dollar-value LIFO inventory method.

Which of the above causes are reflected in differences in the marginal revenue product of factors?

What is meant by the ‘prisoners’ dilemma game’ when applied to the behaviour of oligopolists? What will determine the outcome of the game?

Would you expect a bank to charge a higher rate on a term loan or a highly leveraged transaction (HLT) loan? Why? (LO3)

A machinability rating is to be determined for a new work material using the cutting speed for a 60- min tool life as the basis of comparison. For the base material (B1112 steel), test data resulted in Taylor equation parameter values of n = 0.29 and C = 500, where speed is in m/min and tool life is min. For the new material, the parameter values were n = 0.21 and C = 400. These results were obtained using cemented carbide tooling. (a) Compute a machinability rating for the new material. (b) Suppose the machinability criterion were the cutting speed for a 10-min tool life rather than the present criterion. Compute the machinability rating for this case. (c) What do the results of the two calculations show about the difficulties in machinability measurement?

A dual-in-line package has a total of 48 leads. Use Rent's rule with C = 4.5 and m = 0.5 to determine the approximate number of logic gates that could be fabricated in the IC chip for this package.

How would you attempt to assess whether a particular period of inflation was the result of cost-push or demand-pull pressures?

A machinability rating is to be determined for a new work material. For the base material (B1112), test data resulted in a Taylor equation with parameters n = 0.29 and C = 490. For the new material, the Taylor parameters were n = 0.23 and C = 430. Units in both cases are: speed in m/min and tool life in min. These results were obtained using cemented carbide tooling. (a) Compute a machinability rating for the new material using cutting speed for a 30-min tool life as the basis of comparison. (b) If the machinability criterion were tool life for a cutting speed of 150 m/min, what is the machinability rating for the new material?

Presented below is information related to Kaisson Corporation for the last 3 years. Quantities Base-Year Cost Current-Year Cost in Ending Item Inventories Unit Cost Amount Unit Cost Amount December 31, 2013 A 9,000 $2.00 $18,000 $2.20 $19,800 B 6,000 3.00 18,000 3.55 21,300 C 4,000 5.00 20,000 5.40 21,600 Totals $56,000 $62,700 December 31, 2014 A 9,000 $2.00 $18,000 $2.60 $23,400 B 6,800 3.00 20,400 3.75 25,500 C 6,000 5.00 30,000 6.40 38,400 Totals $68,400 $87,300 December 31, 2015 A 8,000 $2.00 $16,000 $2.70 $21,600 B 8,000 3.00 24,000 4.00 32,000 C 6,000 5.00 30,000 6.20 37,200 Totals $70,000 $90,800 Instructions Compute the ending inventories under the dollar-value LIFO method for 2013, 2014, and 2015. The base period is January 1, 2013, and the beginning inventory cost at that date was $45,000. Compute indexes to two decimal places.

A headline in the Wall Street Journal stated, “Firms Increasingly Tap Their Pension Funds to Use Excess Assets.” What is the accounting issue related to the use of these “excess assets” by companies?