Question & Answer

Of what value is a common set of standards in financialaccounting and reporting?

If you had to explain or define “generally acceptedaccounting principles or standards,” what essential characteristicswould you include in your explanation?

There are 19 correct answers in the following multiple choice questions (some questions have multiple answers that are correct). To attain a perfect score on the quiz, all correct answers must be given. Each correct answer is worth 1 point. Each omitted answer or wrong answer reduces the score by 1 point, and each additional answer beyond the correct number of answers reduces the score by 1 point. Percentage on the quiz is based on the total number of correct answers. 40.1 The manufacturing engineering department in an organization is best described as which one of the following: (a) branch of the sales department, (b) concurrent engineers, (c) management, (d) product designers, (e) production supervisors, or (f) technical staff function? 40.2 Which of the following are the usual responsibilities of the manufacturing engineering department (four best answers): (a) advising on design for manufacturability, (b) facilities planning, (c) marketing the product, (d) plant management, (e) process improvement, (f) process planning, (g) product design, (h) solving technical problems in the production departments, and (i) supervision of production workers? 40.3 Which of the following are considered basic processes, as opposed to secondary processes (four correct answers): (a) annealing, (b) anodizing, (c) drilling, (d) electroplating, (e) forward hot extrusion to produce aluminum bar stock, (f) impression die forging, (g) rolling of sheet steel, (h) sand casting, (i) sheet-metal stamping, (j) spot welding, (k) surface grinding of hardened steel, (l) tempering of martensitic steel, and (m) turning? 40.4 Which of the following would be considered secondary processes, as opposed to basic processes (four correct answers): (a) annealing, (b) arc welding, (c) drilling, (d) electroplating, (e) extrusion to produce steel automotive components, (f) impression die forging, (g) painting, (h) plastic injection molding, (i) rolling of sheet steel, (j) sand casting, (k) sheet-metal stamping, (l) sintering of pressed ceramic powders, and (m) ultrasonic machining? 40.5 Which of the following are operations to enhance physical properties (three correct answers): (a) annealing, (b) anodizing, (c) die casting, (d) drilling, (e) electroplating, (f) rolling of nickel alloys, (g) sheet metal drawing, (h) sintering of pressed ceramic powders, (i) surface grinding of hardened steel, (j) tempering of martensitic steel, (k) turning, and (l) ultrasonic cleaning? 40.6 A route sheet is a document whose principal function is which one of the following: (a) continuous improvement, (b) design for manufacturability, (c) provides authorization for material handlers to move the part, (d) quality inspection procedure, (e) specifies the process plan, or (f) specifies the detailed method for a given operation? 40.7 In a make or buy situation, the decision should always be to purchase the component if the vendor’s quoted price is less than the in-house estimated cost of the component: (a) true or (b) false? 40.8 Which one of the following types of computer-aided process planning relies on parts classification and coding in group technology: (a) generative CAPP, (b) retrieval CAPP, (c) traditional process planning, or (d) none of the preceding?

John Olerud Ltd., a local retailing concern in the Bronx, New York, has decided to change from the conventional retail inventory method to the LIFO retail method starting on January 1, 2015. The company recomputed its ending inventory for 2014 in accordance with the procedures necessary to switch to LIFO retail. The inventory computed was $212,600. Instructions Assuming that John Olerud Ltd.’s ending inventory for 2014 under the conventional retail inventory method was $205,000, prepare the appropriate journal entry on January 1, 2015.

Direct method using estimated costs, benchmarking Devon Ltd allocates support department costs using the direct method and estimated costs. The support department costs are budgeted at $88 000 for department A, $63 000 for department B, and $40 000 for department C. These costs are allocated using the proportion of total cost the firm would pay to an outside service provider.   Required (a)          Allocate budgeted support department costs using the direct method, first using labour hours and then with the outside cost proportions as the allocation bases. (b)          Could Devon Ltd use the cost of purchasing outside as an efficiency benchmark for the cost of both the support departments and the user departments? List several advantages and disadvantages of this approach.

1.       : How might understanding whether an employee is high or low on grit help a manager better communicate with and motivate the employee?

(a)       Pick two public companies, go to their websites and identify their      major strategies.           (b) Pick one of the companies from part (a) and go to the website of a      competitor in the same industry. (For example, if you chose Coles, you            might go to the website of Woolworths.) Now compare the strategies of      both companies and list any similarities and differences.

Kemper Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2015 at a cost of $1,000,000. At December 31, 2014, the raw materials to be purchased have a market value of $950,000. Prepare any necessary December 31, 2014, entry.

In 2024, Sheryl is claimed as a dependent on her parents’ tax return.  Her parents report taxable income of $600,000 (married filing jointly). Sheryl did not provide more than half her own support.  What is Sheryl’s tax liability for the year in each of the following alternative circumstances?

The chairman of the FASB at one time noted that “the flowof standards can only be slowed if (1) producers focus lesson quarterly earnings per share and tax benefits and moreon quality products, and (2) accountants and lawyers relyless on rules and law and more on professional judgmentand conduct.” Explain his comment.

Balanced scorecard at individual level; strategy map; boundary systems Required (a) Reflect on the management accounting case and the balanced scorecards used by Qantas and Virgin Australia as part of their incentive plans. How might they use a strategy map in the process of developing their scorecards? (b) With reference to the management accounting case, explain how the airlines might be able to use the balanced scorecard as a form of boundary system.

Harriet, Herm, and Ronde formed an S corporation called Innovet. Harriet and Herm both contributed cash of $25,000 to get things started. Ronde was a bit short on cash but had a parcel of land valued at $60,000 (basis of $50,000) that he decided to contribute.  The land was encumbered by a $35,000 mortgage. What tax bases will each of the three have in their stock of Innovet?

How should consolidated financial statements be reported this year when statements of individual companies were presented last year?

Some individuals have indicated that the FASB must becognizant of the economic consequences of its pronouncements.What is meant by “economic consequences”?What dangers exist if politics play too much of a role inthe development of GAAP?

{Planning}Through November, Tex has received gross income of $120,000.For December, Tex is considering whether to accept one more work engagement for the year.Engagement 1 will generate $7,000 of revenue at a cost of $4,000, which is deductible for AGI.In contrast, engagement 2 will generate $7,000 of revenue at a costof $3,000,which is deductible as an itemized deduction.Tex files as a single taxpayer.

Grant Company has had a record-breaking year in terms of growth in sales and profitability. However, market research indicates that it will experience operating losses in two of its major businesses next year. The controller has proposed that the company record a provision for these future losses this year, since it can afford to take the charge and still show good results. Advise the controller on the appropriateness of this charge.

What is the distinction between plastic sheet and film?

If you were given complete authority in the matter, howwould you propose that GAAP should be developed andenforced?

How do hot assets affect the character of gain or loss on the sale of a partnership interest?

If this is true, why do people not increase their rate of saving?

Jamel and Jennifer have been married 30 years and have filed a joint return every year of their marriage.Their three daughters, Jade, Lindsay, and Abbi, are ages 12, 17, and 22 respectively and all live at home.None of the daughters provide more than half of her own support.Abbi is a full-time student at a local university and does not have any gross income. a.       How many personal and dependency exemptions are Jamel and Jennifer allowed to claim?

Describe two disclosures required by the Corporations Act with respect to       executive remuneration.             (LO4 and 5)

What restrictions might prevent a partner from selling their partnership interest to a third party?

Ray Albertson is 72 years old and lives by himself in an apartment in Salt Lake City.Ray’s gross income for the year is $3,000.Ray’s support is provided as follows:Himself (11 percent), his daughters Diane (20 percent) and Karen (15percent), his sons Mike (20 percent) and Kenneth (10 percent), his friend Milt (14 percent), and his cousin Henry (12 percent).Absent a multiple support agreement, of the parties mentioned in the problem, who may claim adependency exemption for Ray as a qualifying relative

Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their dependents (Damarcus, Janine, Michael, and Candice).The couple received salary income of $100,000 and they sold their home this year. They initially purchased the home three years ago for $200,000 and they sold it for $250,000.The gain on the sale qualified for the exclusion from the sale of a principal residence.The Jacksons incurred $16,500 of itemized deductions and they had $6,250 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. a. What is the Jacksons’ taxable income and what is their tax liability or (refund)?