Question & Answer

Dean Kastner is 78 years old and lives by himself in an apartment in Chicago.Dean’s gross income for the year is $2,500.Dean’s support is provided as follows:Himself (5 percent, his daughters Camille (25 percent) and Rachel (30 percent), his son Zander (5 percent), his friend Frankie (15 percent), and his niece Sharon (20 percent).

Under what conditions should a short-term obligation be excluded from current liabilities?

What is meant by “tax allocation within a period”? What is the justification for such practice?

Identify the following items as (1) operating, (2) investing, or (3) financing activities: purchase of land, payment of dividends, cash sales, and purchase of treasury stock.

How would you set about judging whether an industry had a genuine case for infant/senile industry protection?

Late in 2011, Joan Seceda and four other investors took the chain of Becker Department Stores private, and the company has just completed its third year of operations under the ownership of the investment group. Andrea Selig, controller of Becker Department Stores, is in the process of preparing the year-end financial statements. Based on the preliminary financial statements, Seceda has expressed concern over inventory shortages, and she has asked Selig to determine whether an abnormal amount of theft and breakage has occurred. The accounting records of Becker Department Stores contain the following amounts on November 30, 2014, the end of the fiscal year. Cost Retail Beginning inventory $ 68,000 $100,000 Purchases 255,000 400,000 Net markups 50,000 Net markdowns 110,000 Sales revenue 320,000 According to the November 30, 2014, physical inventory, the actual inventory at retail is $115,000. Instructions (a) Describe the circumstances under which the retail inventory method would be applied and the advantages of using the retail inventory method. (b) Assuming that prices have been stable, calculate the value, at cost, of Becker Department Stores’ ending inventory using the last-in, first-out (LIFO) retail method. Be sure to furnish supporting calculations. (c) Estimate the amount of shortage, at retail, that has occurred at Becker Department Stores during the year ended November 30, 2014. (d) Complications in the retail method can be caused by such items as (1) freight-in costs, (2) purchase returns and allowances, (3) sales returns and allowances, and (4) employee discounts. Explain how each of these four special items is handled in the retail inventory method.

In the previous problem, propose a way of scheduling to meet the weekly demand if there were four machines instead of three.

At the beginning of the year, Anna began a calendar-year business and placed in service the following assets during the year:

Explain why the rise of e-commerce might increase the number of firms engaging in person-specific pricing.

Imagine that a country can produce just two things: goods and services. Assume that over a given period it could produce any of the following combinations:                   Units of goods 0 10 20 30 40 50 60 70 80 90 100 Units of services 80 79 77 74 70 65 58 48 35 19 0  (a)         Draw the country’s production possibility curve. (b)         Assuming that the country is currently producing 40 units of goods and 70 units of services, what is the opportunity cost of producing another 10 units of goods?  (c)         Explain how the figures illustrate the principle of increasing opportunity cost. (d)         Now assume that technical progress leads to a 10 per cent increase in the output of goods for any given amount of resources. Draw the new production possibility curve. How has the opportunity cost of producing extra units of services altered?

Assume that Best Buy made a December 31 adjusting entry to debit Salaries and Wages Expense and credit Salaries and Wages Payable for $4,200 for one of its departments. On January 2, Best Buy paid the weekly payroll of $7,000. Prepare Best Buy’s (a) January 1 reversing entry; (b) January 2 entry (assuming the reversing entry was prepared); and (c) January 2 entry (assuming the reversing entry was not prepared).

A single-point HSS tool with a 3/64 in nose radius is used in a shaping operation on a ductile steel workpart. The cutting speed is 120 ft/min. The feed is 0.014 in/pass and depth of cut is 0.135 in. Determine the surface roughness for this operation.

What determines the size of this world multiplier effect?

1. To what extent could property rights (either public or private) be successfully extended and invoked to curb the problem of industrial pollution (a) of the atmosphere; (b) of rivers; (c) by the dumping of toxic waste; (d) by the erection of ugly buildings; (e) by the creation of high levels of noise? 2. What protection do private property rights in the real world give to sufferers of noise (a) from neighbours; (b) from traffic; (c) from mobile phones on public transport?

Identify the characteristics of universal life insurance. (LO3)

Identify some of the important advantages of shape-casting processes

Determine the shape factor for each of the extrusion die orifice shapes in Figure P19.32.

The unit cost in a machining operation is the sum of four cost terms. The first three terms are: (1) part load/unload cost, (2) cost of time the tool is actually cutting the work, and (3) cost of the time to change the tool. What is the fourth term?

Why is it necessary to develop a definitional framework for the basic elements of accounting?

In conventional sheet metalworking operations, (a) what is the name of the tooling and (b) what is the name of the machine tool used in the operations?

P.1 If a bank paid its depositors 3 per cent interest and inflation was 5 per cent, what would be the real rate of interest? P.2 Has your real income gone up or down this last year?

War tends to cause significant reactions in financial markets. Why might a war in the Middle East place upward pressure on U.S. interest rates? Why might some investors expect a war like this to place downward pressure on U.S. interest rates? (LO2)

One writer recently noted that 99.4 percent of all companiesprepare statements that are in accordance with GAAP. Why then is there such concern about fraudulentfinancial reporting?

Assume that Mexico suddenly experiences high and unexpected inflation. How could this affect the value of the Mexican peso according to purchasing power parity (PPP) theory? (LO2)

What enables banks safely to engage in both maturity transformation and risk transformation?