Question & Answer

On February 1, 2014, Hewitt Construction Company obtained a contract to build an athletic stadium. The stadium (for a local high school) was to be built at a total cost of $5,400,000 and was scheduled for completion by September 1, 2016. One clause of the contract stated that Hewitt was to deduct $15,000 from the $6,600,000 billing price for each week that completion was delayed. Completion was delayed 6 weeks, which resulted in a $90,000 penalty. Below are the data pertaining to the construction period. 2014 2015 2016 Costs to date $1,620,000 $3,850,000 $5,500,000 Estimated costs to complete 3,780,000 1,650,000 –0– Progress billings to date 1,200,000 3,300,000 6,510,000 Cash collected to date 1,000,000 2,800,000 6,510,000 Instructions (a) Using the percentage-of-completion method, compute the estimated gross profit recognized in the years 2014–2016. (b) Prepare a partial balance sheet for December 31, 2015, showing the balances in the receivables and inventory accounts.

: Describe content theories of motivation.

For Problem 21.12, the lathe has a mechanical efficiency = 0.83. Determine (a) the horsepower consumed by the turning operation; (b) horsepower that must be generated by the lathe; (c) unit horsepower and specific energy for the work material in this operation

Identify sources of leader power and the tactics that leaders use to influence others.

: Describe process theories of motivation.

Explain the difference between artistic-related intangible assets and contract-related intangible assets.

The following are selected ledger accounts of Spock Corporation at December 31, 2014. Cash $ 185,000 Salaries and wages expense (sales) $284,000 Inventory 535,000 Salaries and wages expense (offi ce) 346,000 Sales revenue 4,275,000 Purchase returns 15,000 Unearned sales revenue 117,000 Sales returns and allowances 79,000 Purchases 2,786,000 Freight-in 72,000 Sales discounts 34,000 Accounts receivable 142,500 Purchase discounts 27,000 Sales commissions 83,000 Selling expenses 69,000 Telephone and Internet expense (sales) 17,000 Accounting and legal services 33,000 Utilities expense (offi ce) 32,000 Insurance expense (offi ce) 24,000 Miscellaneous offi ce expenses 8,000 Advertising expense 54,000 Rent revenue 240,000 Delivery expense 93,000 Extraordinary loss (before tax) 70,000 Depreciation expense (offi ce equipment) 48,000 Interest expense 176,000 Depreciation expense (sales equipment) 36,000 Common stock ($10 par) 900,000 Spock’s effective tax rate on all items is 34%. A physical inventory indicates that the ending inventory is $686,000. Instructions Prepare a condensed 2014 income statement for Spock Corporation.7

Koch Corporation is in the process of preparing its annual financial statements for the fiscal year ended April 30, 2015. Because all of Koch’s shares are traded intrastate, the company does not have to file any reports with the Securities and Exchange Commission. The company manufactures plastic, glass, and paper containers for sale to food and drink manufacturers and distributors. Koch Corporation maintains separate control accounts for its raw materials, work in process, and finished goods inventories for each of the three types of containers. The inventories are valued at the lowerof- cost-or-market. The company’s property, plant, and equipment are classified in the following major categories: land, office buildings, furniture and fixtures, manufacturing facilities, manufacturing equipment, and leasehold improvements. All fixed assets are carried at cost. The depreciation methods employed depend on the type of asset (its classification) and when it was acquired. Koch Corporation plans to present the inventory and fixed asset amounts in its April 30, 2015, balance sheet as shown below. Inventories $4,814,200 Property, plant, and equipment (net of depreciation) 6,310,000 Instructions What information regarding inventories and property, plant, and equipment must be disclosed by Koch Corporation in the audited financial statements issued to stockholders, either in the body or the notes, for the 2014–2015 fiscal year?

: Explain how the reinforcement perspective can be used to motivate employees.

1.    Contemporary best-selling management books often argue that customers are the most important element in the external environment. Do you agree? In what company situations might this statement be untrue?

Jake is a retired jockey who takes monthly trips to Las Vegas to gamble on horse races.  Jake also trains race horses part time at his Louisville ranch.  So far this year, Jake has won almost $47,500 during his trips to Las Vegas while spending $27,250 on travel expenses and incurring $62,400 of gambling losses.  Jake also received $60,000 in revenue from his training activities and he incurred $72,000 of associated costs.  Explain how Jake’s gambling winnings and related costs will be treated for tax purposes.  Describe the factors that will influence how Jake’s ranch expenses are treated for tax purposes.

: Discuss how job design influences motivation.

What income tax issues must a corporation consider before it makes a noncash distribution to a shareholder?

1.    : How might Cody Sexton’s decision differ if he based it on the utilitarian approach versus individualism approach versus practical approach to ethical decision making? Which approach does he appear to be using?

Five friends, Jackie (0.5 percent owner), Jermaine (1 percent owner), Marlon (2 percent owner), Janet (86 percent owner), and Tito (10.5 percent owner) are shareholders in Jackson 5 Inc. (an S corporation).  As employees of the company, each receives health insurance ($10,000 per year benefit), dental insurance ($2,000 per year benefit), and free access to a workout facility located at company headquarters ($500 per year benefit).  What are the tax consequences of these benefits for each shareholder and for Jackson 5 Inc.?

Is the child tax credit a refundable or nonrefundable credit?  Explain.

1.       : Use Herzberg’s two-factor theory to explain why motivation seems to be high and turnover low at Publix, based on the information provided in the chapter opening example.

1.       : Can you think of a bad decision from your own school or work experience, or from recent business or political news stories, that was made in an effort to correct or justify a past decision? As a new manager, how might you resist the urge to choose a decision alternative based on the idea that it might correct or validate a previous decision?

Aram’s taxable income before considering capital gains and losses is $60,000. Determine Aram’s taxable income and how much of the income will be taxed at ordinary rates in each of the following alternative scenarios (assume Aram files as a single taxpayer).   a. Aram sold a capital asset that he owned for more than one year for a $5,000 gain, a capital asset that he owned for more than one year for a $500 loss, a capital asset that he owned for six months for a $1,200 gain, and a capital asset he owned for two months for a $900 loss.

What are some of the disadvantages of PM methods?

1.       : Psychologists have identified three pathways to happiness: pleasure, engagement, and meaning. Do you think it is the manager’s responsibility to help people find these elements in their work? Discuss.

1.    Jeff Immelt, CEO of GE, tweeted for the first time in September 2012, prompting this response: “@JeffImmelt how come my grandfather got on twitter before you?” Do you think managers should use Twitter and other social media? Can you be an effective manager today without using new media? Why?

The following information has been obtained for the Gocker Corporation. 1. Prior to 2014, taxable income and pretax financial income were identical. 2. Pretax financial income is $1,700,000 in 2014 and $1,400,000 in 2015. 3. On January 1, 2014, equipment costing $1,200,000 is purchased. It is to be depreciated on a straightline basis over 5 years for tax purposes and over 8 years for financial reporting purposes. (Hint: Use the half-year convention for tax purposes, as discussed in Appendix 11A.) 4. Interest of $60,000 was earned on tax-exempt municipal obligations in 2015. 5. Included in 2015 pretax financial income is an extraordinary gain of $200,000, which is fully taxable. 6. The tax rate is 35% for all periods. 7. Taxable income is expected in all future years. Instructions (a) Compute taxable income and income taxes payable for 2015. (b) Prepare the journal entry to record 2015 income tax expense, income taxes payable, and deferred taxes. (c) Prepare the bottom portion of Gocker’s 2015 income statement, beginning with “Income before income taxes and extraordinary item.” (d) Indicate how deferred income taxes should be presented on the December 31, 2015, balance sheet.

What is continuity testing, and when is it performed in the PCB fabrication sequence?

The cutting force and thrust force in an orthogonal cutting operation are 1470 N and 1589 N, respectively. The rake angle = 5°, the width of the cut = 5.0 mm, the chip thickness before the cut = 0.6, and the chip thickness ratio = 0.38. Determine (a) the shear strength of the work material and (b) the coefficient of friction in the operation.