Question & Answer

What are the advantages and disadvantages of welding compared to other types of assembly operations?

C. Reither Co. reports the following information for 2014: sales revenue $700,000; cost of goods sold $500,000; operating expenses $80,000; and an unrealized holding loss on available-for-sale securities for 2014 of $60,000. It declared and paid a cash dividend of $10,000 in 2014. C. Reither Co. has January 1, 2014, balances in common stock $350,000; accumulated other comprehensive income $80,000; and retained earnings $90,000. It issued no stock during 2014. Instructions Prepare a statement of stockholders’ equity.

Jorge is puzzled that the IRS and his CPA could legitimately reach different conclusions on a tax issue.  Why does this happen?

Which way is the L2 curve likely to shift in the following cases? (a) The balance of trade moves into deficit. (b) People anticipate that foreign interest rates are likely to rise relative to domestic ones. (c) The domestic rate of inflation falls below that of other major trading countries. (d) People believe that the pound is about to depreciate.

In a wire drawing operation, why must the drawing stress never exceed the yield strength of the work metal?

A 7-station transfer line has been observed over a 40-hour period. The process times at each station are as follows: station 1, 0.80 min; station 2, 1.10 min; station 3, 1.15 min; station 4, 0.95 min; station 5, 1.06 min; station 6, 0.92 min; and station 7, 0.80 min. The transfer time between stations = 6 sec. The number of downtime occurrences = 110, and hours of downtime = 14.5 hours. Determine (a) the number of parts produced during the week, (b) the average actual production rate in parts/hour, and (c) the line efficiency. (d) If the balancing efficiency were computed for this line, what would its value be?

The present level of a country’s exports is £12 billion; investment is £2 billion; government expenditure is £4 billion; total consumer spending (not Cd) is £36 billion; imports are £12 billion and expenditure taxes are £2 billion. The economy is currently in equilibrium. It is estimated that an income of £50 billion is necessary to generate full employment. The mps is 0.1, the mpt is 0.05 and the mpm is 0.1 (a)  Is there an inflationary or deflationary gap in this situation? (b)  What is the size of the gap? (Don’t confuse this with the difference between Ye and YF.) (c)  What would be the appropriate government policies to close this gap?

What was the purpose of the Securities Act of 1933? What was the purpose of the Securities Exchange Act of 1934? Do these laws prevent investors from making poor investment decisions? Explain. (LO2)

Absent any special elections, what effect does a sale of partnership interest have on the partnership?

What is the difference between the Codification and theCodification Research System?

Vargo Corp. owes $270,000 to First Trust. The debt is a 10-year, 12% note due December 31, 2014. Because Vargo Corp. is in financial trouble, First Trust agrees to extend the maturity date to December 31, 2016, reduce the principal to $220,000, and reduce the interest rate to 5%, payable annually on December 31. Instructions (a) Prepare the journal entries on Vargo’s books on December 31, 2014, 2015, 2016. (b) Prepare the journal entries on First Trust’s books on December 31, 2014, 2015, 2016.

A tensile test uses a test specimen that has a gage length of 50 mm and an area = 200 mm2 . During the test the specimen yields under a load of 98,000 N. The corresponding gage length = 50.23 mm. This is the 0.2 percent yield point. The maximum load of 168,000 N is reached at a gage length = 64.2 mm. Determine (a) yield strength, (b) modulus of elasticity, and (c) tensile strength. (d) If fracture occurs at a gage length of 67.3 mm, determine the percent elongation. (e) If the specimen necked to an area = 92 mm2 , determine the percent reduction in area.

Historically, taxpayers have implemented strategies to mitigate or eliminate the effects of double taxation. Why might taxpayers think twice before implementing such strategies today?  Explain.

For the copper-nickel phase diagram in Figure 6.2, find the compositions of the liquid and solid phases for a nominal composition of 70% Ni and 30% Cu at 1371°C (2500°F).

A test specimen in a tensile test has a gage length of 2.0 in and an area = 0.5 in2 . During the test the specimen yields under a load of 32,000 lb. The corresponding gage length = 2.0083 in. This is the 0.2 percent yield point. The maximum load of 60,000 lb is reached at a gage length = 2.60 in. Determine (a) yield strength, (b) modulus of elasticity, and (c) tensile strength. (d) If fracture occurs at a gage length of 2.92 in, determine the percent elongation. (e) If the specimen necked to an area = 0.25 in2 , determine the percent reduction in area.

How does a corporation’s adjustment to earnings and profits differ based on the tax treatment of a stock redemption to the shareholder (i.e., as either a dividend or exchange)?

What are the main distinctions between a traditional financial instrument and a derivative financial instrument?

The adjusted trial balance for Ed Bradley Co. is presented in the following worksheet for the month ended April 30, 2014.   Instructions Complete the worksheet and prepare a classified balance sheet.

Adjusting data for use with regression; outlier Smeyer Industries is a large entity with more than 40 departments, each employing 35 to 100 persons. Recent experience suggests that the cost function used to estimate overhead in Department IP-14 is no longer appropriate. The current function was developed three years ago. Since then, a number of changes occurred in the facilities and processes used in Department IP-14. The changes happened one at a time. Each time a change was made, the cost accountant felt the change was not major enough to justify calculating a new overhead cost function. Now it is clear that the cumulative effect of the changes has been large. You have been assigned the task to develop a new cost function for overhead in Department IP-14. Initial analysis suggests that the number of direct labour hours is an appropriate cost driver. Departmental records are available for nine months. The records reveal the following information.       An assistant has analysed the data for March through July and made the appropriate adjustments except for the following items (for which the assistant was unsure of the proper treatment).                            (i)              The semi-annual property tax bill for Department IP-14 was paid on June 30. The entire amount of $3,000 was charged to overhead for June.                          (ii)              The costs to install a new piece of equipment with a life of 10 years in the department were charged to overhead in April. The installation costs were $4,300.                        (iii)              Factory depreciation is allocated to Department IP-14 every month. The department’s share, $8,000, is included in overhead.                        (iv)              A strike closed the plant for three weeks in July. Several non-union employees were kept on payroll during the strike. Their duties were general housekeeping and 'busy work' These costs were charged to overhead.   You also have the details for the overhead account for the months of August and September. They are presented in the following table. You were hired on October 1 and have been keeping the department accounts since then. Therefore, you know that the data for October and November are correct, except for any adjustments needed for the preceding items.       Required (a)          Using the information provided, adjust the monthly cost data to more accurately reflect the overhead costs incurred during each month. (b)          Discuss whether the data for July should be included in the estimate of future costs. Use a scatter plot to help you answer this question. (c)           Develop a cost function by regressing overhead costs in Department IP-14 on direct labour hours. Discuss whether your cost function would be reasonable for estimating future overhead costs. Ignore any items you will discuss in part (d). (d)          Identify and discuss any additional adjustments that might be needed to more accurately measure overhead costs for the regression in part (c). (e)           Explain why adjustments probably need to be made to information from accounting records when estimating a cost function.

For what is the bend allowance intended to compensate?

Part 1: Capital leases and operating leases are the two classifications of leases described in FASB pronouncements from the standpoint of the lessee. Instructions (a) Describe how a capital lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming the lease transfers ownership of the property to the lessee by the end of the lease. (b) Describe how an operating lease would be accounted for by the lessee both at the inception of the lease and during the first year of the lease, assuming equal monthly payments are made by the lessee at the beginning of each month of the lease. Describe the change in accounting, if any, when rental payments are not made on a straight-line basis. Do not discuss the criteria for distinguishing between capital leases and operating leases. Part 2: Sales-type leases and direct-financing leases are two of the classifications of leases described in FASB pronouncements from the standpoint of the lessor. Instructions Compare and contrast a sales-type lease with a direct-financing lease as follows. (a) Lease receivable. (b) Recognition of interest revenue. (c) Manufacturer’s or dealer’s profit. Do not discuss the criteria for distinguishing between the leases described above and operating leases.

Have unemployment rates generally risen or fallen over the decades or is there no discernible pattern? Does the answer vary by country?

What effect will the discrimination by the firm have on the wages and employment of black workers in other firms in the area if (a) these other firms discriminate against black workers; (b) they do not discriminate?

1.    : If a male manager tries to change his behaviors to incorporate elements of interactive leadership more common to female managers, can he still be an “authentic” leader? Discuss.

For what reasons may the NAIRU increase?