Question 1
A testing lab owns a hydraulic load frame, which was purchased for $35,000 early in the lab?s fiscal year 4 years ago. The internal bookkeeping uses a sum of the year?s digits depreciation method assuming a life of 12 years and zero salvage value. For tax purposes, it is being depreciated with a 25% Capital Cost Allowance. The lab?s MARR is 10%. The fiscal year is the same as the calendar year. The existing frame has no value on the second hand market. The operating and maintenance costs for this frame have remained constant, and will remain constant, at $6500.00 per year. There is a new load frame on the market, which sells for $40,000.00, and its operating and maintenance costs are estimated to be $3,000 in the first year, increasing by 15% per year. This new frame does have a second hand value estimated to decline 50% from the original purchase price in the first year, a further 30% in the second year and subsequently level off at $12000.00 for the foreseeable future. (a) What was the internal depreciation charge that was made last year? (b) What will the Undepreciated Capital Cost of the load frame be at the end of this fiscal year? (c) If the frame is in fact sold for $5,000 this year what final entry must be made on this year?s tax filing? (d) What is the economic life of the new machine? Show all calculations or include a copy of your excel spreadsheet. (e) Should the existing frame be replaced with the new model (now)? Justify your answer.
Question 2
1. (TCO C) Presented below is pension information related to Woods, Inc. for the year 2013. Service cost $76,000 Interest on projected benefit obligation $47,000 Interest on vested benefits $24,000 Amortization of prior service cost due to increase in benefits $12,000 Expected return on plan assets $18,000 The amount of pension expense to be reported for 2013 is (Points : 5) $159,000. $117,000. $105,000. $141,000. 2. (TCO C) Kasper, Inc. sponsors a defined-benefit pension plan. The following data relates to the operation of the plan for the year 2013. Service cost $260,000 Contributions to the plan $250,000 Actual return on plan assets $240,000 Projected benefit obligation (beginning of year) $2,700,000 Fair value of plan assets (beginning of year) $2,900,000 The expected return on plan assets and the settlement rate were both 9%. The amount of pension expense reported for 2013 is (Points : 5) $503,000.00. $260,000.00. $242,000.00. $263,000.00. 3. (TCO C) A pension asset is reported when (Points : 5) the fair value of the pension plan assets is less than the accumulated benefit obligation. the fair value of the pension plan assets is less than the accumulated benefit obligation and a prior service cost exists. the accumulated benefit obligation is less than the fair value of the pension plan assets. the projected benefit obligation is less than the fair value of the pension plan assets. . 4. (TCO C) Kathy's Kittens, Inc. has provided the following information for their post-retirement benefits plan for 2013. Service cost $860,000 Discount rate 10% APBO, January 1, 2013 $5,200,000 EPBO, January 1, 2013 $5,600,000 Average remaining service to full eligibility 20 years Average remaining service to expected retirement 25 years The amount of post-retirement expense for 2013 is (Points : 5) $1,380,000. $1,588,000. $1,640,000. $1,420,000.,Hi I am still waiting answers for this one too. Thanks.
Question 3
11. Trading Marketable Securities: A. are considered non-current assets. B. are recorded at amortized cost. C. are marked to the lower of cost or market each accounting period. D. are marked to market each accounting period. 12. The classification of marketable equity securities as trading or available-for-sale is determined by: A. management's intent regarding the disposition of the securities. B. when the securities mature. C. whether the current assets are greater or less than the current liabilities. D. whether management wants to mark them to market or not. 13. The reclassification of trading securities as available-for-sale would produce the following effect: A. The balance sheet would need to be adjusted to report the securities at fair market value and there would be no effect on the income statement. B. There would be no effect on either the balance sheet or the income statement. C. The balance sheet would need to be adjusted to report the securities at fair market value and unrealized gains or losses on the date of the transfer would be included in net income. D. There would be no effect on the balance sheet and unrealized gains or losses on the date of the transfer would be included in net income. 14. The equity method of accounting for investments requires: A. Investment should be marked to market each accounting period. B. Pro-rata share of investee's earnings should be recorded as investment income. C. Company should not have significant influence over investee. D. Goodwill related to purchase of investee stock to be recorded separately on balance sheet. 3. (20 points) What is the equation to calculate terminal value? If excel calculates that the npv or present value of a set of forecasted free cash flows is $ 4,400, there are $400 in marketable securities on the balance sheet, and $1,000 in debt calculate the total value of the equity. Given the value of equity you calculated above calculate the intrinsic price per Share if there are 500 shares outstanding? After you complete the valuation you call down to the trading floor and ask for the current price. You are told the shares are trading at $8.35. Are the shares undervalued or overvalued?
Question 4
etson Co. sold 20,000 units of its only product and incurred a $50,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2012's activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $150,000. The maximum output capacity of the company is 40,000 units per year. JETSON COMPANY Contribution Margin Income Statement For Year Ended December 31, 2011 Sales. $750,000 Variable costs. 600,000 Contribution margin 150,000 Fixed costs.. 200,000 Net Loss... $(50,000) Required 1.Compute the break-even point in dollar sales for year 2011. 2.Compute the predicted break-even point in dollar sales for year 2012 assuming the machine is installed and there is no change in the unit sales price. 3.Prepare a forecasted contribution margin income statement for 2012 that shows the expected results with the machine installed. Assume that the unit sales price and the number of units sold will not change, and no income taxes will be due. 4.Compute the sales level required in both dollars and units to earn $140,000 of after-tax income in 2012 with the machine installed and no change in the unit sales price. Assume that the income tax rate is 30%. 5.Prepare a forecasted contribution margin income statement that shows the results at the sales level computed in part 4. Assume an income tax rate of 30%.
Question 5
This is the second part to the critical thinking paper that you just wrote for me. I need this to be completed by next week, the attached instructions are attached. Please read the instructions on pages 2 and three, starting where it says Instructions for Critical Analysis (part 2) Below is a summary of what is expected to be in the paper. (Remember it must be as instructed on the attachment I sent you) Part 2 ? Critical thinking Analysis Write a three page critical analysis of the article which ? Examines the Author?s point of view and motives ? Challenges the authors view (taking the opposing point of view) ? Reaches a conclusion of your own,Rachel P. Here is the second part to the assignment. Take your time, but please let me know what else you require. Attached is the initial paper you sent me, so there is no confusion on what topic I need completed.,You where the one that wrote that summary and picked the case file, remember. This is the second part of the assigment. You should have the case study. You wrote the summary paper.,What is the QID, and where do I locate it?,"The QID sould be 7430098 let me know if it's not it",try this QID 7430248,7430248, has to be it... I had 2 QID on the same day. I think I just confused the numbers.,You wrote the paper, I gave you both of the QID that I had from last week. Use them, and figure out where you got the summary from. I don't know, you Rachel P did it. Not me so I don't have the article. I will re send both QID that I had from last weekend. Please let me know ASAP, one of these needs to be it QID 7430248 or QID 7430098,Any updates on this paper? will you be able to finish it by its deadline?
