Question & Answer

For the steel ring of preceding Problem 11.10(b), determine the volume of molten metal that must be poured into the mold, given that the liquid shrinkage is 0.5%, solidification shrinkage = 3%, and solid contraction after freezing = 7.2%

What is the purpose of the bead coil in a pneumatic tire?

In 2024, Amanda and Jaxon Stuart have a daughter who is one year old.  The Stuarts are full-time students and are both 23 years old.  Their only sources of income are gains from stock they held for three years before selling and wages from part-time jobs. What is their earned income credit in the following alternative scenarios if they file jointly?

On January 1, 2014, Lesley Benjamin signed an agreement to operate as a franchisee of Campbell Inc. for an initial franchise fee of $50,000. The amount of $10,000 was paid when the agreement was signed, and the balance is payable in five annual payments of $8,000 each,  beginning January 1, 2015. The agreement provides that the down payment is not refundable and that no future services are required of the franchisor. Lesley Benjamin’s credit rating indicates that she can borrow money at 11% for a loan of this type. Instructions (a) How much should Campbell record as revenue from franchise fees on January 1, 2014? At what amount should Benjamin record the acquisition cost of the franchise on January 1, 2014? (b) What entry would be made by Campbell on January 1, 2014, if the down payment is refundable and substantial future services remain to be performed by Campbell? (c) How much revenue from franchise fees would be recorded by Campbell on January 1, 2014, if: (1) The initial down payment is not refundable, it represents a fair measure of the services already provided, a significant amount of services is still to be performed by Campbell in future periods, and collectibility of the note is reasonably assured? (2) The initial down payment is not refundable and no future services are required by the franchisor, but collection of the note is so uncertain that recognition of the note as an asset is unwarranted? (3) The initial down payment has not been earned and collection of the note is so uncertain that recognition of the note as an asset is unwarranted?

Aishwarya’s husband passed away in 2023. She needs to determine whether Jasmine, her 17-year-old stepdaughter who is single, qualifies as her dependent in 2024. Jasmine is a resident but not a citizen of the United States. She lived in Aishwarya’s home from June 15 through December 31, 2024. Aishwarya provided more than half of Jasmine’s support for 2024.

Matt Broderick Company began operations on January 2, 2013. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 6 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows. Actual Hourly Vacation Days Used Sick Days Used Wage Rate by Each Employee by Each Employee 2013 2014 2013 2014 2013 2014 $10 $11 0 9 4 5 Matt Broderick Company has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when earned and to accrue sick pay when earned. Instructions (a) Prepare journal entries to record transactions related to compensated absences during 2013 and 2014. (b) Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2013 and 2014.

Consider the advantages and disadvantages of extending property rights so that everyone would have the right to prevent people imposing any costs on them whatsoever (or charging them to do so).

Indicate how the hardenability alloying elements in steel affect the TTT curve.

How does economics predict rational consumers will treat spending on credit cards compared with spending cash? Do you think there are likely to be differences in the way people spend by each? If so, can you explain why?

Timo is the sole owner of Jazz Inc., an S corporation.  On October 31, 2024, Timo executed an unsecured demand promissory note of $15,000 and transferred the note to Jazz (Jazz could require Timo to pay it $15,000 on demand).  When Timo transferred the note to Jazz, his tax basis in his Jazz stock was zero. On January 31, 2025, Timo paid the $15,000 to Jazz as required by the promissory note.  For the taxable year ending December 31, 2024, Jazz incurred a business loss of $12,000.  How much of the loss clears the stock and debt basis hurdles for deductibility?

1.    : Many people who are successful at the start-up stage of a business are not the right people to carry the venture forward to middle age. How do you decide whether you are better suited to be a serial entrepreneur (start a business and then move on to start another) or whether you can guide your venture as it grows and matures?

Mike Devereaux Company shows the following entries in its Equipment account for 2015. All amounts are based on historical cost. Equipment 2015 2015 Jan. 1 Balance 134,750 June 30 Cost of equipment sold Aug. 10 Purchases 32,000 (purchased prior 12 Freight on equipment to 2015) 23,000 purchased 700 25 Installation costs 2,700 Nov. 10 Repairs 500 Instructions (a) Prepare any correcting entries necessary. (b) Assuming that depreciation is to be charged for a full year on the ending balance in the asset account, compute the proper depreciation charge for 2015 under each of the methods listed below. Assume an estimated life of 10 years, with no salvage value. The machinery included in the January 1, 2015, balance was purchased in 2013. (1) Straight-line. (2) Sum-of-the-years’-digits.

What is the benefit of a single set of high-quality accounting standards?

Hendrickson Corporation reported net income of $50,000 in 2014. Depreciation expense was $17,000. The following working capital accounts changed. Accounts receivable $11,000 increase Available-for-sale securities 16,000 increase Inventory 7,400 increase Nontrade note payable 15,000 decrease Accounts payable 12,300 increase Compute net cash provided by operating activities.

Aggie Corporation made a distribution of $500,000 to Rusty Cedar in partial liquidation of the company on December 31 of this year.  Rusty, an individual, owns 100 percent of Aggie Corporation. The distribution was in exchange for 50 percent of Rusty’s stock in the company. At the time of the distribution, the shares had a fair market value of $200 per share. Rusty’s tax basis in the shares was $50 per share. Aggie had E&P of $8,000,000 at the time of the distribution.

Gingrich Importers provides the following pension plan information. Fair value of pension plan assets, January 1, 2014 $2,400,000 Fair value of pension plan assets, December 31, 2014 2,725,000 Contributions to the plan in 2014 280,000 Benefi ts paid retirees in 2014 350,000 Instructions From the data above, compute the actual return on the plan assets for 2014.

For what purposes did the AICPA in 1959 create theAccounting Principles Board?

For an accrual-method partnership, are accounts receivable considered unrealized receivables? Explain.

Included in Outkast Company’s December 31, 2014, trial balance are the following accounts: Prepaid Rent $5,200; Debt Investments (trading) $56,000; Unearned Fees $17,000; Land (held for investment) $39,000; Notes Receivable (long-term) $42,000. Prepare the long-term investments section of the balance sheet.

If both demand and supply change, and if we know which direction they have shifted but not how much, why is it that we will be able to predict the direction in which either price or quantity will change, but not both? (Clue: consider the four possible combinations and sketch them if necessary: (a) D left, S left; (b) D right, S right; (c) D left, S right (d) D right, S left.)

Where there is evidence that the utility of inventory goods, as part of their disposal in the ordinary course of business, will be less than cost, what is the proper accounting treatment?

On September 1, 2014, Sands Company sold at 104 (plus accrued interest) 4,000 of its 9%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $15 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Sands Company bonds. Interest is payable on December 1 and June 1. Bond issue costs of $30,000 were incurred. Instructions Prepare in general journal format the entry to record the issuance of the bonds.

1.       : Describe specific ways that you might incorporate Twitter into an organization’s communication with customers. How about with employees?

What are the basic problems that occur in the valuation of accounts receivable?

Under what conditions of bond issuance does a discount on bonds payable arise? Under what conditions of bond issuance does a premium on bonds payable arise?