Question & Answer

Describe the consequences for failure to file a tax return and late payment of taxes owed.

1.       : How would you apply systems thinking to a problem such as poor performance in your current academic studies? What about a problem with a romantic partner or family member? For each situation, try to identify all the elements and their interdependencies.

Briefly describe some of the similarities and differences between GAAP and IFRS with respect to income tax accounting.

Before reading on, how would you define scarcity? Must goods be at least temporarily unattainable to be scarce?

Describe the circumstances in which a taxpayer acquires a home and rents it out and is not allowed to deduct a portion of the interest expense on the loan the taxpayer used to acquire the home.

What are the important variables that affect mass diffusion?

Describe the purpose of a pension plan’s vesting schedule and explain how it works. (LO3)

An extruder has a barrel diameter of 3.5 in and a length of 5.0 ft. It has a screw channel depth of 0.16 in and a flight angle of 22°. The extruder screw rotates at 75 rev/min. The polymer melt has a shear viscosity = 65 x 10-4 lb-sec/in2 at the operating temperature of 525°F. The specific gravity of the polymer is 1.2 and its tensile strength is 8000 lb/in0.11 lb/sec. The density of water is 62.5 lb/ft3 . (a) Find the equation for the extruder characteristic. (b) Find the operating point (Q and p), and (c) the die characteristic that is indicated by the operating point . A T-shaped cross section is extruded at a rate of

1.    Would the task environment for a wireless provider such as Verizon Wireless contain the same elements as that for a government welfare agency? Discuss the similarities and differences.

(Looking at the Maths) 1. Referring to equation (3), if the term a has a value of –50 000 and the term b a value of 0.001, construct a demand schedule with respect to total income (Y). Do this for incomes between £100 million and £300 million at £50 million intervals. (Looking at the Maths) 2. Now use this schedule to plot a demand curve with respect to income. Comment on its shape.

For what reasons might a company restrict a portion of its retained earnings?

Although Hank is retired, he is an excellent handyman and often works part time on small projects for neighbors and friends. Last week his neighbor, Mike, offered to pay Hank $500 for minor repairs to his house. Hank completed the repairs in December of this year. Hank uses the cash method of accounting and is a calendar-year taxpayer. Compute Hank’s gross income for this year from each of the following alternative transactions:

Risk classification Regal Foods is a multi-divisional company operating in a range of locations around the globe. Its product-based divisions are: Ice Cream and Associated Dairy Products, Confectionery, Nutrition, and Prepared Food. Regal has total sales in excess of $10 billion. The CEO, Ruby Day, recently undertook a company review, which identified the following strategies and objectives: • optimising product performance through strong research and development, product innovation and market share growth • enhancing financial performance through financial discipline and targeted capital expenditure.   Divisional managers have traditionally been allowed significant autonomy in line with the decentralised divisional structure. CFO Paul Falkenberg has recently introduced relative performance evaluation (RPE) at the divisional level to promote competitiveness, with the objective of growing the company.   Ice Cream and Associated Dairy Products Division The Ice Cream and Associated Dairy Products Division focuses on such products as ice cream, yoghurt, milk and cheeses. The current divisional manager is Alette Rennie, who has been in the position for the past three years. In that time, Alette has achieved average annual divisional revenue growth of 6 per cent. However, there are concerns about some of the exposures the division has. For example in a recent email to the CFO and CEO, Alette expressed concerns about some of the division’s exposures to the agricultural industry, the increasing global competition in dairy products, and the lack of bargaining power of the company in the local milk price wars.   Nutrition Division The Nutrition Division focuses on health-related products. Historically, the Nutrition Division has been an excellent contributor to group performance, with annual growth rates of up to 12 per cent for the period 2006 to 2012, and revenues exceeding $2 billion. However, divisional manager Bruce Buncle has found it increasingly difficult to maintain growth. An increasingly crowded market for health and nutritional products seems to be the main driver of these difficulties. As a consequence, debt levels of the division seem to be rising. However, Buncle is conscious that he needs to develop new products and markets in line with company objectives.   Buncle and his management team have been considering a range of investment opportunities and have decided on a major investment in the bottled water industry. While the industry has its challenges (for example, environmental opposition to the use of plastic bottles, tightening environmental regulations and the expectation of reduced carbon emissions), Buncle and his management team see a lot of potential with such a strategic move. However, where significant capital expenditure is required, Buncle finds the company investment decision-making processes frustrating.   The management team within the Nutrition Division has identified a new spring water source in a regional area. The local authorities are in favour of the springs being used to supply the Nutrition Division with spring water for a new water bottling plant to be built in the region. In fact, the local authorities are willing to forgo local taxes and provide subsidies to Regal to ensure the plant is built. The region has experienced relatively high levels of unemployment in recent years and the new plant will generate some 100 local new jobs. While there is some local opposition to the new facility on environmental grounds, Buncle considers these to be manageable. While he knows the project’s financial benefit is mainly after the third year, he knows that the investment is a good strategic move for his division.   Required Using the risk classification framework (strategic, operational, legal and regulatory, and financial) identify the key risks to which Regal and its divisions are exposed. (LO6)

Calaf’s Drillers erects and places into service an off-shore oil platform on January 1, 2015, at a cost of $10,000,000. Calaf is legally required to dismantle and remove the platform at the end of its useful life in 10 years. Calaf estimates it will cost $1,000,000 to dismantle and remove the platform at the end of its useful life in 10 years. (The fair value at January 1, 2015, of the dismantle and removal costs is $450,000.) Prepare the entry to record the asset retirement obligation.

1. Could the long run and the very long run ever be the same length of time? 2. What will the long-run and very long-run market supply curves for a product look like? How will the shape of the long-run curve depend on returns to scale? 3. In the very long run, new isoquants will have to be drawn as factor productivity changes. An increase in productivity will shift the isoquants inwards towards the origin: less capital and labour will be required to produce any given level of output. Will this be a parallel inward shift of the isoquants? Explain.

How have money market rates changed since the beginning of the semester? Consider the current economic conditions. Do you think money market rates will increase or decrease during the semester? Offer some logic to support your answer. (LO1)

Accounting information provides useful information about business transactions and events. Those who provide and use financial reports must often select and evaluate accounting alternatives. The FASB statement on qualitative characteristics of accounting information examines the characteristics of accounting information that make it useful for decision-making. It also points out that various limitations inherent in the measurement and reporting process may necessitate trade-offs or sacrifices among the characteristics of useful information. Instructions (a) Describe briefly the following characteristics of useful accounting information. (1) Relevance. (4) Comparability. (2) Faithful representation. (5) Consistency. (3) Understandability. (b) For each of the following pairs of information characteristics, give an example of a situation in which one of the characteristics may be sacrificed in return for a gain in the other. (1) Relevance and faithful representation. (3) Comparability and consistency. (2) Relevance and consistency. (4) Relevance and understandability. (c) What criterion should be used to evaluate trade-offs between information characteristics?

SCC corporation (a calendar-year C corporation) has a net operating loss (NOL) carryover to 2024 in the amount of $30,000.  How much tax will SCC pay for 2024 if it reports taxable income from operations of $20,000 before considering loss carryovers under the following assumptions?   a. The NOL originated in 2017.

Briefly discuss the implications of the financial statement presentation project for the reporting of stockholders’ equity.

Finman Company designated Jill Holland as petty cash custodian and established a petty cash fund of $200. The fund is reimbursed when the cash in the fund is at $15. Petty cash receipts indicate funds were disbursed for office supplies $94 and miscellaneous expense $87. Prepare journal entries for the establishment of the fund and the reimbursement.

What are some ways that a parent could effectively shift income to a child? What are some of the disadvantages of these methods?

Which is preferable: general subsidies for public transport, or cheap fare policies for specific groups (such as children, students and pensioners)?

Compare the management of a closed-end fund with that of an open-end fund. Given the differences in the funds’ characteristics, explain why the management of liquidity is different in the open-end fund as compared with the closed-end fund. Assume that the funds are the same size and have the same goal to invest in stocks and to earn a very high return. Which portfolio manager do you think will achieve a larger increase in the fund’s net asset value? Explain. (LO1, LO5)

Describe the characteristics that a measure of money should have if it is to be manipulated by the Fed. (LO2)

How does a shaping process differ from a surface processing operation?