Question & Answer

Why might pension funds be exposed to interest rate risk? How can pension funds reduce their exposure to interest rate risk? (LO7)

Using the appropriate interest table, answer the following questions. (Each case is independent of the others). (a) What is the future value of 20 periodic payments of $4,000 each made at the beginning of eachperiod and compounded at 8%? (b) What is the present value of $2,500 to be received at the beginning of each of 30 periods, discounted at 10% compound interest? (c) What is the future value of 15 deposits of $2,000 each made at the beginning of each period and compounded at 10%? (Future value as of the end of the fifteenth period.) (d) What is the present value of six receipts of $1,000 each received at the beginning of each period, discounted at 9% compounded interest?

A horizontal true centrifugal casting operation will be used to make copper tubing. The lengths will be 1.5 m with outside diameter = 15.0 cm, and inside diameter = 12.5 cm. If the rotational speed of the pipe = 1000 rev/min, determine the G-factor.

What would have happened if countries in deficit had not responded to an outflow of gold by reducing total expenditure?

Is it possible for the government to target the money supply over the longer term without targeting the level of public-sector net borrowing?

Define yield strength of a material.

1.      : Review the section on goal conflict in the chapter. Do you think that building a coalition and working out stakeholder differences in goal preferences is an important part of a manager’s job? Why or why not?

Why should inventories be included in (a) a statement of financial position and (b) the computation of net income?

How are gains and losses from extinguishment of a debt classified in the income statement? What disclosures are required of such transactions?

Describe the method that blockchain technology utilizes to store data. (LO2)

What is the difference between the APBO and the EPBO? What are the components of postretirement expense?

Francine’s mother Donna and her father Darren separated and divorced in September of this year. Francine lived with both parents until the separation. Francine does not provide more than half of her own support. Francine is 15 years old at the end of the year.  a. Is Francine a qualifying child to Donna?

What does the assets/equity ratio of a bank indicate? (LO3)

Explain why some financial institutions prefer to sell the mortgages they originate. (LO4)

Under what circumstances would brazing or soldering be preferred over welding?

Novak Corporation is preparing its 2014 statement of cash flows, using the indirect method. Presented below is a list of items that may affect the statement. Using the code below, indicate how each item will affect Novak’s 2014 statement of cash flows. Code Letter Effect A Added to net income in the operating section D Deducted from net income in the operating section. R-I Cash receipt in investing section P-I Cash payment in investing section R-F Cash receipt in financing section P-F Cash payment in financing section N Noncash investing and financing activity Items ____ (a) Purchase of land and building. ____ (j) Increase in accounts payable. ____ (b) Decrease in accounts receivable. ____ (k) Decrease in accounts payable. ____ (c) Issuance of stock. ____ (l) Loan from bank by signing note. ____ (d) Depreciation expense. ____ (m) Purchase of equipment using a note. ____ (e) Sale of land at book value. ____ (n) Increase in inventory. ____ (f) Sale of land at a gain. ____ (o) Issuance of bonds. ____ (g) Payment of dividends. ____ (p) Redemption of bonds payable. ____ (h) Increase in accounts receivable. ____ (q) Sale of equipment at a loss. ____ (i) Purchase of available-for-sale investment. ____ (r) Purchase of treasury stock.

GAAP requires the statement of cash flows be presented when financial statements are prepared. Instructions (a) Explain the purposes of the statement of cash flows. (b) List and describe the three categories of activities that must be reported in the statement of cash flows. (c) Identify and describe the two methods that are allowed for reporting cash flows from operations. (d) Describe the financial statement presentation of noncash investing and financing transactions. Include in your description an example of a noncash investing and financing transaction.

Explain why boards of directors will often employ independent             remuneration consultants to assist in developing and assessing      compensation plans.             (LO5)

Explain how cost of goods is treated when a business sells inventory.

Distinguish between counterbalancing and noncounterbalancing errors. Give an example of each.

Presented below are the comparative income and retained earnings statements for Denise Habbe Inc. for the years 2014 and 2015. LIFO Basis FIFO Basis 2014 2013 2014 2013 Sales $3,000 $3,000 $3,000 $3,000 Cost of goods sold 1,130 1,000 1,100 940 Operating expenses 1,000 1,000 1,000 1,000 Income before profi t-sharing 870 1,000 900 1,060 Profi t-sharing expense 87 100 96 100 Net income $ 783 $ 900 $ 804 $ 960 2015 2014 Sales $340,000 $270,000 Cost of sales 200,000 142,000 Gross profi t 140,000 128,000 Expenses 88,000 50,000 Net income $ 52,000 $ 78,000 Retained earnings (Jan. 1) $125,000 $ 72,000 Net income 52,000 78,000 Dividends (30,000) (25,000) Retained earnings (Dec. 31) $147,000 $125,000 The following additional information is provided: 1. In 2015, Denise Habbe Inc. decided to switch its depreciation method from sum-of-the-years’-digits to the straight-line method. The assets were purchased at the beginning of 2014 for $100,000 with an estimated useful life of 4 years and no salvage value. (The 2015 income statement contains depreciation expense of $30,000 on the assets purchased at the beginning of 2014.) 2. In 2015, the company discovered that the ending inventory for 2014 was overstated by $24,000; ending inventory for 2015 is correctly stated. Instructions Prepare the revised retained earnings statement for 2014 and 2015, assuming comparative statements. (Ignore income taxes.)

What will happen to the equilibrium price and quantity of butter in each of the following cases? You should state whether demand or supply (or both) have shifted and in which direction. (In each case assume ceteris paribus.) (a) A rise in the price of non-dairy spread. (b) A rise in the demand for cream. (c) A rise in the price of bread. (d) A rise in the demand for bread. (e) An expected rise in the price of butter in the near future. (f) A tax on butter production. (g) The invention of a new, but expensive, process for removing all saturated fat from butter, alongside the passing of a law which states that all butter producers must use this process.

What features or rights may alter the character of preferred stock?

Distinguish between minimum rental payments and minimum lease payments, and indicate what is included in minimum lease payments.

The part in Problem 33.1 is to be fabricated using fused deposition modeling instead of stereolithography. Layer thickness is to be 0.20 mm and the width of the extrudate deposited on the surface of the part = 1.25 mm. The extruder workhead moves in the x-y plane at a speed of 150 mm/s. A delay of 10 s is experienced between each layer to reposition the workhead. Compute an estimate for the time required to build the part.