Long-term investment

ACC 557 Homework 4: Chapters 11 and 12

Directions: Answer the following questions on a separate Microsoft Word or Excel document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in Blackboard.

 

Exercises

 

E11-7. Quay Co. had the following transactions during the current period.

 

Mar. 2               Issued 5,000 shares of $5 par value common stock to attorneys in payment of a bill for $30,000 for services performed in helping the company to incorporate.

June 12             Issued 60,000 shares of $5 par value common stock for cash of $375,000.

July 11              Issued 1,000 shares of $100 par value preferred stock for cash at $110 per share.

Nov. 28             Purchased 2,000 shares of treasury stock for $80,000.

 

Instructions

Journalize the transactions.

 

E11-13. On January 1, Guillen Corporation had 95,000 shares of no-par common stock issued and outstanding. The stock has a stated value of $5 per share. During the year, the following occurred.

 

Apr. 1               Issued 25,000 additional shares of common stock for $17 per share.

June 15             Declared a cash dividend of $1 per share to stockholders of record on June 30.

July 10              Paid the $1 cash dividend.

Dec. 1              Issued 2,000 additional shares of common stock for $19 per share.

15             Declared a cash dividend on outstanding shares of $1.20 per share to stockholders of record on December 31.

 

Instructions

  1. a)Prepare the entries, if any, on each of the three dividend dates.
  2. b)How are dividends and dividends payable reported in the financial statements prepared at December 31?

 

 

E12-8. Presented below are two independent situations.

 

  1. Gambino Cosmetics acquired 10% of the 200,000 shares of common stock of Nevins Fashion at a total cost of $13 per share on March 18, 2015. On June 30, Nevins declared and paid a $60,000 dividend. On December 31, Nevins reported net income of $122,000 for the year. At December 31, the market price of Nevins Fashion was $15 per share. The stock is classified as available-for-sale.
  2. Kanza, Inc., obtained significant influence over Rogan Corporation by buying 40% of Rogan’s 30,000 outstanding shares of common stock at a total cost of $9 per share on January 1, 2015. On June 15, Rogan declared and paid a cash dividend of $30,000. On December 31, Rogan reported a net income of $80,000 for the year.

 

Instructions

Prepare all the necessary journal entries for 2015 for (a) Gambino Cosmetics and (b) Kanza, Inc.

 

E12-12. Uttinger Company has the following data at December 31, 2015.

 

The available-for-sale securities are held as a long-term investment.

 

Instructions

  1. a)Prepare the adjusting entries to report each class of securities at fair value.
  2. b)Indicate the statement presentation of each class of securities and the related unrealized gain (loss) accounts.

 

 

Problems

 

P11-3A. The stockholders’ equity accounts of Castle Corporation on January 1, 2015, were as follows.

Preferred Stock (8%, $50 par, cumulative, 10,000 shares authorized)             $  400,000

Common Stock ($1 stated value, 2,000,000 shares authorized)                        1,000,000

Paid-in Capital in Excess of Par—Preferred Stock                                             100,000

Paid-in Capital in Excess of Stated Value—Common Stock                            1,450,000

Retained Earnings                                                                                         1,816,000

Treasury Stock (10,000 common shares)                                                             50,000

 

During 2015, the corporation had the following transactions and events pertaining to its stockholders’ equity.

 

Feb. 1               Issued 25,000 shares of common stock for $120,000.

Apr. 14             Sold 6,000 shares of treasury stock—common for $33,000.

Sept. 3             Issued 5,000 shares of common stock for a patent valued at $35,000.

Nov. 10             Purchased 1,000 shares of common stock for the treasury at a cost of $6,000.

Dec. 31             Determined that net income for the year was $452,000.

No dividends were declared during the year.

 

Instructions

  1. a)Journalize the transactions and the closing entry for net income.
  2. b)Enter the beginning balances in the accounts, and post the journal entries to the stockholders’ equity accounts. (Use J5 for the posting reference.)
  3. c)Prepare a stockholders’ equity section at December 31, 2015, including the disclosure of the preferred dividends in arrears.

 

 

P12-6A. The following data, presented in alphabetical order, are taken from the records of Nieto Corporation.

 

The investment in Sasse common stock is considered to be a long-term available-for-sale security.

Statement of cash flows

ACC 557 Homework 5 Chapter 13

Directions: Answer the following questions on a separate Microsoft Word or Excel document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in Blackboard.

Exercises

E13-3. Cushenberry Corporation had the following transactions.

  1. Sold land (cost $12,000) for $15,000.
  2. Issued common stock at par for $20,000.
  3. Recorded depreciation on buildings for $17,000.
  4. Paid salaries of $9,000.
  5. Issued 1,000 shares of $1 par value common stock for equipment worth $8,000.
  6. Sold equipment (cost $10,000, accumulated depreciation $7,000) for $1,200.

 

Instructions

For each transaction above, (a) prepare the journal entry, and (b) indicate how it would affect the statement of cash flows using the indirect method.

 

E13-4. Gutierrez Company reported net income of $225,000 for 2015. Gutierrez also reported depreciation expense of $45,000 and a loss of $5,000 on the disposal of equipment. The comparative balance sheet shows a decrease in accounts receivable of $15,000 for the year, a $17,000 increase in accounts payable, and a $4,000 decrease in prepaid expenses.

 

Instructions

Prepare the operating activities section of the statement of cash flows for 2015. Use the indirect method.

 

 

Problems

P13-3A. The income statement of Whitlock Company is presented here.

Additional information:

  1. Accounts receivable increased $200,000 during the year, and inventory decreased $500,000.
  2. Prepaid expenses increased $150,000 during the year.
  3. Accounts payable to suppliers of merchandise decreased $340,000 during the year.
  4. Accrued expenses payable decreased $100,000 during the year.
  5. Operating expenses include depreciation expense of $70,000.

 

Instructions

Prepare the operating activities section of the statement of cash flows for the year ended November 30, 2015, for Whitlock Company, using the indirect method.

 

 

P13-7A. Presented below are the financial statements of Nosker Company.

Additional data:

  1. Dividends declared and paid were $20,000.
  2. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale.
  3. All depreciation expense, $14,500, is in the operating expenses.
  4. All sales and purchases are on account.

 

Instructions

  1. a)Prepare a statement of cash flows using the indirect method.
  2. b)Compute free cash flow.

Marginal Cost

 

AB 224 Unit 7 Assignment

1. The accompanying table shows a car manufacturer’s total cost of producing cars.

Quantity of cars Total Cost
0 $500,000
1 $540,000
2 $560,000
3 $570,000
4 $590,000
5 $620,000
6 $660,000
7 $720,000
8 $800,000
9 $920,000
10 $1,100,000

  1. What is this manufacturer’s fixed cost?(Don’t forget this question. Some students don’t see it.)

  1. For each level of output except zero output, calculate this manufacturer’s marginal cost (MC).

  1. For each level of output except zero output, calculate the variable cost (VC).

  1. For each level of output except zero output, calculate the average variable cost (AVC),

  1. For each level of output, calculate the average total cost (ATC),

  1. For each level of output except zero output, calculate the average fixed cost (AFC).

Quantity of cars Total Cost Marginal Cost

b.

Variable Cost

c.

Average Variable Cost

d.

Average Total Cost

e.

Average Fixed Cost

f.

0 $500,000
1 $540,000          
2 $560,000          
3 $570,000          
4 $590,000          
5 $620,000          
6 $660,000          
7 $720,000          
8 $800,000          
9 $920,000          
10 $1,100,000          

  1. What number of carsis the manufacturer’s minimum cost output level?

  1. You produce widgets. Currently you produce 4 widgets at a total cost of $40.

  1. What is your average total cost?

  1. Suppose you could produce one more (the fifth) widget at a marginal cost of $5. If you do produce that fifth widget, what will your average total cost be? Has your average total cost increased or decreased? Why?

  1. Suppose instead that you could produce one more (the fifth) widget at a marginal cost of $20. If you do produce that fifth widget, what will your average total cost be? Has your average total cost increased or decreased? Why?

The opportunity cost

AB 224 Unit 3 Assignment

Comparative advantage

AB 224 Unit 2 Assignment

1. A representative of the American clothing industry recently made the following statement: “Workers in Asia often work in sweatshop conditions earning only pennies an hour. American workers are more productive and as a result earn higher wages. In order to preserve the dignity of the American workplace, the government should enact legislation banning imports of low – wage Asian clothing.”

  1. Which parts of this quote are positive statements?Which parts are normative statements? (Be sure to identify all three statements in the quote.)

 

  1. Is the policy that is being advocated consistent with the preceding statements about the wages and productivities of American and Asian workers?Why?
  1. Would such a policy make some Americans better off without making any other Americans worse off? That is, would this policy be efficient from the viewpoint of all Americans?Why?
  1. Would low – wage Asian workers benefit from or be hurt by such a policy?Why?

Instead of legislation banning the imports (considered a quota), assume that the government enacts a special tax on imported clothing that is so high that the selling price of the imports would be equal to the selling price of the same clothing made in America. This kind of tax is called a tariff and is enacted to protect domestic producers of the same items that can be imported at much lower costs. Answer the following:

  1. What would shoppers see when they shopped in Wal-Mart and the other “big box” stores that sell so many imported items?
  1. Would this tax policy have a better effect, worse effect, or no different effect on American workers than the legislation banning the imports discussed in question 1? What kind of effect would the tax have on the Asian workers? (This question is often missed by students. Please compare a tariff to a quota for the answer.)
  1. In the ancient country of Roma, only two goods, spaghetti and meatballs, are produced. There are two tribes in Roma, the Tivoli and the Frivoli. By themselves, the Tivoli each month can produce either 30 pounds of spaghetti and no meatballs, or 50 pounds of meatballs and no spaghetti, or any combination in between. The Frivoli, by themselves, each month can produce 40 pounds of spaghetti and no meatballs, or 30 pounds of meatballs and no spaghetti, or any combination in between.

Examine the first diagram showing the monthly production possibility frontier for the Tivoli and the monthly production possibility frontier for the Frivoli.

 

  1. Which tribe has thecomparativeadvantage in spaghetti production? Why?
  1. Which tribe has thecomparativeadvantage in meatball production? Why?

In A.D. 100 the Frivoli discover a new technique for making meatballs that doubles the quantity of meatballs they can produce each month.  Examine the new monthly production possibility frontier for the Frivoli.

  1. After the innovation, which tribe now has anabsoluteadvantage in producing meatballs? Why?
  1. Which tribe now has anabsoluteadvantage in producing spaghetti? Why?
  1. Which has thecomparativeadvantage in meatball production? Why?
  1. Which has thecomparativeadvantage in spaghetti production? Why?
  1. According to the U.S. Census Bureau, in July 2006 the United States exported aircraft worth $1 billion to China and imported aircraft worth only $19,000 from China. During the same month, however, the United States imported $83 million worth of men’s trousers, slacks, and jeans from China but exported only $8,000 worth of trousers, slacks, and jeans to China. Using what you have learned about how trade is determined by comparative advantage, answer the following questions.
  1. Which country has the comparative advantagein aircraft production?  Which country has the comparative advantage in production of trousers, slacks, and jeans? Why?
  1. Can you determine which country has theabsolute advantagein aircraft production and which country has the absolute advantage in production of trousers, slacks, and jeans? Why?

 

 Link to other AB 224 Assignments

Career Competencies

AB224 Unit 1 Assignment Template:

Name:                        –

Course Number:     –

Section Number:    –

Unit Number:           – 1

Date:                          –          

———————————- General Instructions for all Assignments———————————–

  1. Unless specified differently by your course instructor, save this assignment template to your computer with the following file naming format:

Course number_section number_LAST_FIRST_ unit number

  1. At the top of the template, insert the appropriate information: Your Name, Course Number, Section Number and Date

  1. Insert your answers below, or in the appropriate space provided for in the question.Your answers should follow the APA format with citations to your sources and, at the bottom of your last page, a list of references. Your answers should also be in Standard English with correct spelling, punctuation, grammar, and style (double spaced, in Times New Roman, 12-point, black font). Respond to questions in a thorough manner, providing specific examples of concepts, topics, definitions, and other elements asked for in the questions.

  1. Provide a list of references at the end of the last page of your assignment.

  1. Upload the completed assignment to the appropriate dropbox.

  1. Any questions about the assignment, or format questions, should be directed to your course instructor.

——————————————- Career Competencies —————————————–

In this assignment, you will engage in developing the following career competencies:

Analyzing Quantitative Data

Analyzing Qualitative Data

Improving Global Awareness

——————————————-     Assignment          ——————————————-

  1. Liza needs to buy a textbook for the next economics class. The price at the college bookstore is $65. One online site offers it for $55 and another site, for $57. All prices include sales tax. The accompanying table indicates the typical shipping and handling charges for the textbook ordered online.

Shipping method Delivery time Charge
Standard shipping 3–7 days $3.99
Second-day air 2 business days $8.98
Next-day air 1 business day $13.98

  1. What is the opportunity cost of buying online instead of at the bookstore?Note that if you buy the book online, you must wait to get it. (Be sure to define opportunity cost and cite it correctly.)

  1. Show the relevant choices for this student. What determines which of these options the student will choose?(There are several choices, so be sure to list all of them.)

  1. In August 2007, a sharp downturn in the U.S. housing market reduced the income of many who worked in the home construction industry. A Wall Street Journal news article reported that Wal-Mart’s wire-transfer business was likely to suffer because many construction workers are Hispanics who regularly send part of their wages back to relatives in their home countries via Wal-Mart. With this information, use one of the principles of economy-wide interaction to trace a chain of links that explains how reduced spending for U.S. home purchases is likely to affect the performance of the Mexican economy.(Be sure to list the principle, and cite it correctly.)

  1. During the Great Depression, food was left to rot in the fields or fields that had once been actively cultivated were left fallow. Use one of the principles of economy-wide interaction to explain how this could have occurred.(Be sure to list the principle, and cite it correctly.)

Link to other AB 224 Assignments

Public stewardship in budgeting

Critical need for public stewardship in budgeting

Write a 700- to 1,050-word paper outlining the critical need for public stewardship in budgeting. Detail the needs and methods for training public officials and staff members for ethical public budget preparation and maintenance strategies. Make sure to include: Detail the need and importance of public stewardship in budgeting Ethical requirements for leaders to consider for proper public stewardship Consequences of unethical or poor public stewardship Consider utilizing a recent current events article for reference to a recent incident of unethical public stewardship of budgetary monies.

Include at least two academic sources in your paper, including one from the University Library

Write a 700- to 1,050-word paper outlining the critical need for public stewardship in budgeting. Detail the needs and methods for training public officials and staff members for ethical public budget preparation and maintenance strategies. Make sure to include: Detail the need and importance of public stewardship in budgeting Ethical requirements for leaders to consider for proper public stewardship Consequences of unethical or poor public stewardship Consider utilizing a recent current events article for reference to a recent incident of unethical public stewardship of budgetary monies.

Include at least two academic sources in your paper, including one from the University Library

Business expansion and strategies

Business expansion and strategies

JIM is acquiring all of the assets of Mason Machining, Inc. in a merger transaction. Mason transfers assets having a FMV of $1,775,000 and an adjusted basis of $995,000 and $200,000 in liabilities to JIM in exchange for $750,000 in cash and $800,000 of JIM’s common stock.

Click here to view Mason’s Acquisition Data.

Explain what type of merger this is. JIM distributes its stock and cash to Mason in exchange for all of its assets. Calculate Mason’s gain on this transaction. How much of this gain will Mason recognize? How must tax liability will Mason incur from this transfer? Mason distributes the JIM stock and cash to its shareholders for all of their shares of Mason’s stock. Shareholders’ basis in this stock is $600,000.

Calculate how much gain the Mason’s shareholders will realize and recognize on this transfer. How must tax liability will Mason’s shareholders incur from this transfer? Explain the tax implications for JIM.

Accounting and Audit Enforcement

Accounting and Audit Enforcement

At http://www.sec.gov/divisions/enforce/friactions/friactions2012.shtml, perform a search on several U.S. health care publicly-traded companies and choose a health care organization that has been accused of committing health care fraud.

Write a five to six (5-6) page paper in which you:

1.Evaluate the level of SOX regulations that applies to for-profit and not-for-profit health care organizations, indicating whether or not mandating SOX requirements for non-profits might reduce fraud and increase corporate governance. Provide support for your rationale.

2.Determine whether SOX has been effective in regulating ethical behavior of for-profit health care organizations. Defend your position.

3.Review the audit report issued by the external auditing firm from the company’s Website for the year it was accused of fraud. Then, determine whether the external auditors were negligent in preparing the audit report for the company. Formulate an opinion regarding which Internal Control was deficient or what GAAP was violated. Defend your position.

4.Determine what provision(s) of SOX was / were violated in the health care fraud case in question. Indicate whether or not SOX adequately provides sanctions to deter the behavior or if changes are needed to the regulations to remedy the issue(s) and thus ensure compliance.

5.Based on the fraudulent activity that occurred, recommend two (2) improvements to the internal control environment to reduce those occurrences. Provide detailed recommendations.

6.Use at least four (4) quality academic resources in this assignment. Note: Wikipedia and other Websites do not qualify as academic resources.

Your assignment must follow these formatting requirements:

Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

Income Statement

Income Statement Ford Motor Company In a two to three-page paper

Income Statement – Ford Motor Company In a two- to three-page paper (excluding the title and reference pages), explain the purpose of an income statement and how it reflects the firm’s financial status. Include important points that an analyst would use in assessing the financial condition of the company. Also, analyze Ford Motor Company’s income statement from its 2012 Annual Report. Your paper must be formatted according to APA style as outlined in the Ashford Writing Center, and it must include citations and references for the text and at least two scholarly sources from the Ashford University LibraryIncome Statement – Ford Motor Company In a two- to three-page paper (excluding the title and reference pages), explain the purpose of an income statement and how it reflects the firm’s financial status. Include important points that an analyst would use in assessing the financial condition of the company. Also, analyze Ford Motor Company’s income statement from its 2012 Annual Report. Your paper must be formatted according to APA style as outlined in the Ashford Writing Center, and it must include citations and references for the text and at least two scholarly sources from the Ashford University Library