Question & Answer

Matt Holmes recently joined Klax Company as a staff accountant in the controller’s office. Klax Company provides warehousing services for companies in several European cities. The location in Koblenz, Germany, has not been performing well due to increased competition and the loss of several customers that have recently gone out of business. Matt’s department manager suspects that the plant and equipment may be impaired and wonders whether those assets should be written down. Given the company’s prior success, this issue has never arisen in the past, and Matt has been asked to conduct some research on this issue. Instructions Access the IFRS authoritative literature at the IASB website (http://eifrs.iasb.org/). (Click on the IFRS tab andthen register for free eIFRS access if necessary.) When you have accessed the documents, you can use thesearch tool in your Internet browser to respond to the following questions. (Provide paragraph citations.) (a) What is the authoritative guidance for asset impairments? Briefly discuss the scope of the standard (i.e., explain the types of transactions to which the standard applies). (b) Give several examples of events that would cause an asset to be tested for impairment. Does it appear that Klax should perform an impairment test? Explain. (c) What is the best evidence of fair value? Describe alternate methods of estimating fair value.

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

Describe the order in which different types of tax credits are applied to reduce a taxpayer’s tax liability.

1.      : How do you think Clarke should have communicated his concerns about the information link? Why?

In a surface grinding operation performed on hardened plain carbon steel, the grinding wheel has a diameter = 200 mm and width = 25 mm. The wheel rotates at 2400 rev/min, with a depth of cut (infeed) = 0.05 mm/pass and a crossfeed = 3.50 mm. The reciprocating speed of the work is 6 m/min, and the operation is performed dry. Determine (a) length of contact between the wheel and the work and (b) volume rate of metal removed. (c) If there are 64 active grits/cm2 of wheel surface, estimate the number of chips formed per unit time. (d) What is the average volume per chip? (e) If the tangential cutting force on the work = 25 N, compute the specific energy in this operation?

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

1.      Describe the primary activities in the value chain for an accounting firm that issues audit reports. In your opinion, which primary activities create the most value?

Boyne Inc. had beginning inventory of $12,000 at cost and $20,000 at retail. Net purchases were $120,000 at cost and $170,000 at retail. Net markups were $10,000; net markdowns were $7,000; and sales revenue was $147,000. Compute ending inventory at cost using the conventional retail method.

The frontal working area of the electrode in an ECM operation is 2000 mm2. The applied current = 1800 amps and the voltage = 12 volts. The material being cut is nickel (valence = 2), whose specific removal rate is given in Table 26.1. (a) If the process is 90% efficient, determine the rate of metal removal in mm3/min. (b) If the resistivity of the electrolyte = 140 ohm-mm, determine the working gap.

The positioning table for a component insertion machine uses a stepping motor and leadscrew mechanism. The design specifications require a table speed of 40 in/min and an accuracy = 0.0008 in. The pitch of the leadscrew = 0.2 in, and the gear ratio = 2:1 (2 turns of the motor for each turn of the leadscrew). The mechanical errors in the motor, gear box, leadscrew, and table connection are characterized by a normal distribution with standard deviation = 0.0001 in. Determine (a) the minimum number of step angles in the stepping motor, and (b) the frequency of the pulse train required to drive the table at the desired maximum speed.

Wade Corp. has 150,000 shares of common stock outstanding. In 2014, the company reports income from continuing operations before income tax of $1,210,000. Additional transactions not considered in the $1,210,000 are as follows. 1. In 2014, Wade Corp. sold equipment for $40,000. The machine had originally cost $80,000 and had accumulated depreciation of $30,000. The gain or loss is considered ordinary. 2. The company discontinued operations of one of its subsidiaries during the current year at a loss of $190,000 before taxes. Assume that this transaction meets the criteria for discontinued operations. The loss from operations of the discontinued subsidiary was $90,000 before taxes; the loss from disposal of the subsidiary was $100,000 before taxes. 3. An internal audit discovered that amortization of intangible assets was understated by $35,000 (net of tax) in a prior period. The amount was charged against retained earnings. 4. The company had a gain of $125,000 on the condemnation of much of its property. The gain is taxed at a total effective rate of 40%. Assume that the transaction meets the requirements of an extraordinary item. Instructions Analyze the above information and prepare an income statement for the year 2014, starting with income from continuing operations before income tax. Compute earnings per share as it should be shown on the face of the income statement. (Assume a total effective tax rate of 38% on all items, unless otherwise indicated.)

List some factors that could cause an increase in the credit items of the balance of payments and a decrease in the debit items. What would be the effect on the exchange rate (assuming that it is freely floating)? What effect would these exchange rate movements have on the balance of payments?

Suppose you asked your favorite AI query tool the following question: “Who Cares about taxes and why?”  The AI tool provided the following response:

What are the two depreciation conventions that apply to tangible personal property under MACRS? Explain why Congress provides two methods.

(Threshold Concept 14) 1. Give some examples of supply-side policy. (see Chapter 23 for some ideas if you are stuck). (Threshold Concept 14) 2. If there is an increase in aggregate supply, will this result in an increase in potential growth?

What is an integrated circuit?

1. Give some other examples of public goods. Does the provider of these goods (the government or local authority) charge for their use? If so, is the method of charging based on the amount of the good that people use? Is it a good method of charging? Could you suggest a better method? 2. Name some goods or services provided by the government or local authorities that are not public goods. 3. Are there ways in which we could overcome the free-rider problem? Start by thinking about the provision of a public good amongst a group of friends or neighbours.

William is a single writer (age 35) who recently decided that he needs to save more for retirement. His current year AGI before the IRA contribution deduction is $80,000 (all earned income). a. If he does not participate in an employer-sponsored plan, what is the maximum deductible IRA contribution William can make for the current year? b. If he does participate in an employer-sponsored plan, what is the maximum deductible IRA contribution William can make for the current year? c. Assume the same facts as in part (b), except William’s AGI before the IRA contribution deduction is $89,000. What is the maximum deductible IRA contribution William can make for the current year?

Describe the Fed’s monetary policy response to the credit crisis that began in 2008. (LO2)

Explain each of the following terms: authorized capital stock, unissued capital stock, issued capital stock, outstanding capital stock, and treasury stock.

Define process capability.

The financial statements of P&G are presented in Appendix 5B. The company’s complete annual report, including the notes to the financial statements, can be accessed at the book’s companion website, www. wiley.com/college/kieso. Instructions Refer to P&G’s financial statements and the accompanying notes to answer the following questions. (a) What descriptions are used by P&G in its balance sheet to classify its property, plant, and equipment? (b) What method or methods of depreciation does P&G use to depreciate its property, plant, and equipment? (c) Over what estimated useful lives does P&G depreciate its property, plant, and equipment? (d) What amounts for depreciation and amortization expense did P&G charge to its income statement in 2011, 2010, and 2009? (e) What were the capital expenditures for property, plant, and equipment made by P&G in 2011, 2010, and 2009?

Walkin Inc. is considering the write-down of its long-term plant because of a lack of profitability. Explain to the management of Walkin how to determine whether a write-down is permitted.

Explain how gains or losses on impaired assets should be reported in income.

Explain how a partner’s debt relief affects their amount realized in a sale of partnership interest.