Question 1
Please answer the written questions in an attached WORD document (not directly in Vista). The questions are provided to help with your discussion, please answer the questions with supporting rational. The ratios can be calculated in excel and attached as an appendix or copied into the word document. 1. Provide an overview of the business strategy of Manufactured Homes, Inc. 2. What operating conditions were they facing in 1986 and 1987? What are the major uncertainties with respect to the future? 3. Identify the accounting policies of Manufactured Homes, Inc. which have the most significant impact on the company?s financial statements. Consider/discuss: a. What are the key assumptions underlying these policies? b. Do you think that these assumptions are justified? c. What is your overall assessment of Manufactured Homes? earnings quality? 4. Evaluate the company`s performance during 1986 and the first 9 months of 1987, by comparing to trends from prior years. a. Using at a minimum ROE and 1 ratio from each of income statement ratios, asset turnover, working capital management, liquidity, debt and coverage and profitability. b. Discuss what would happen to those ratios if changes were made to the key accounting policies identified in question 3. c. What is making this company show a profit? d. Identify significant changes in balances from year to year on the balance sheet. e. Identify significant changes as a % of sales on the income statement from year to year. 5. Given the company`s business strategy, accounting policies and recent performance, what are the potential risks for an investor in the company`s stock? Should Jane Edwards recommend the addition of the stock to her firm?s growth stock fund? Be sure to explain/discuss your opinion.,I forgot to mention that these questions are based on the cased: "Manufactured Homes Inc." by Palepu textbook. If you need the case to read, I can scan it send it to you. The reading is very short.,Case page 2,Case page3,Case page4,Case page5,Case page6,Case page7,Case page8,Case page8,Case page9,Case page10,Case page11,Case page12,case page13,Case page14,Case page15,Case page16,case page17,case page18,page19,case page20,case page21,pg22,pg23,pg24,******* And also, please don't forget to view the very first original file I've sent you. (Not the case reading i just sent, but the one in Excel with consolidated data: Income statement, balance sheet etc.) This is due Friday by 10:00 AM.,When do I get to hear the confirmation response from you? I'm still waiting for you to confirm it.,Has my assignment being accepted????? I need an answer ASAP.,Hello..?? Why is it taking so long to reply for confirmation? Yes or No?,HELLO?? When do i get the confirmation email? this is way too slow!!!!
Question 2
Operating Leverage and Forecasting Problems I am working these problems, and would like to see if my answers correspond. If possible, please show as much detail as possible when figuring out the equations so I can follow the work. When calculating earnings per share and PE ratios, please show your work. 1. You manufacture hunting pack systems in China for 80 dollars each, including shipping. The manufacturing costs only include variable costs. Variable costs are not calculated as a percentage of sales in this case. Sales are a function of the number of packs sold and the price per pack. Likewise, variable costs are a function of the number of packs sold and the cost to produce each pack. You sell these packs to retailers for 200 dollars each. In the current year you will sell 100,000 packs. Your fixed costs including such items as insurance, marketing, travel, shows, office supplies, warehouse rentals etc. totals 5 million dollars this year and are not part of the 80 dollars per pack manufacturing cost. The federal income tax rate for your company is 40 percent. Your company is publicly traded on the NASDAQ with 1,000,000 shares outstanding. a. Please create a current income statement using the same format as found in the lecture. b. Please calculate earnings per share. c. Please calculate the price/earnings multiple assuming that the current stock price is 10 dollars per share. 2. Create a two-year forecast of the income statement from the information provided in problem number one. Please create three columns of data: current year, year 2, and year 3. Assume that sales increase ten percent per year for year?s two and three. Please show the earnings per share for each of the three years. 3. Please estimate the stock price for year?s two and three, assuming that the current PE multiple remains constant for each of the two forecasted years.,Operating Leverage and Forecasting Problems Please complete the following problems and place them in the assignment section by midnight of the last day of the week assigned. When calculating earnings per share and PE ratios, please show your work. This problem is similar to the examples shown in the lecture. You manufacture hunting pack systems in China for 80 dollars each, including shipping. The manufacturing costs only include variable costs. Variable costs are not calculated as a percentage of sales in this case. Sales are a function of the number of packs sold and the price per pack. Likewise, variable costs are a function of the number of packs sold and the cost to produce each pack. You sell these packs to retailers for 200 dollars each. In the current year you will sell 100,000 packs. Your fixed costs including such items as insurance, marketing, travel, shows, office supplies, warehouse rentals etc. totals 5 million dollars this year and are not part of the 80 dollars per pack manufacturing cost. The federal income tax rate for your company is 40 percent. Your company is publicly traded on the NASDAQ with 1,000,000 shares outstanding. Please create a current income statement using the same format as found in the lecture. Please calculate earnings per share. Please calculate the price/earnings multiple assuming that the current stock price is 10 dollars per share. Create a two-year forecast of the income statement from the information provided in problem number one. Please create three columns of data: current year, year 2, and year 3. Assume that sales increase ten percent per year for year?s two and three. Please show the earnings per share for each of the three years. 3. Please estimate the stock price for year?s two and three, assuming that the current PE multiple remains constant for each of the two forecasted years. Please format in Excel,Where are we at on this assignment? Thank you.
Question 3
81. Joe operates a business that locates and purchases specialized assets for clients, among other activities. Joe uses the accrual method of accounting but he doesn?t keep any significant inventories of the specialized assets that he sells. Joe reported the following financial information for his business activities during year 0. Determine the effect of each of the following transactions on the taxable business income. a. Joe has signed a contract to sell gadgets to the city. The contract provides that sales of gadgets are dependent upon a test sample of gadgets operating successfully. In December, Joe delivers $12,000 worth of gadgets to the city that will be tested in March. Joe purchased the gadgets especially for this contract and paid $8,500. b. Joe paid $180 for entertaining a visiting out-of-town client. The client didn?t discuss business with Joe during this visit, but Joe wants to maintain good relations to encourage additional business next year. c. On November 1, Joe paid $600 for premiums providing for $40,000 of ?key man? insurance on the life of Joe?s accountant over the next 12 months. d. At the end of the year (year 1), Joe?s business reports $9,000 of accounts receivable. Based upon past experience, Joe believes that at least $2,000 of his new receivables will be uncollectible. e. In December of year 0, Joe rented equipment for a large job. The rental agency required a minimum rental of three months ($1,000 per month), but Joe completed the job before year-end. f. Joe hired a new sales representative as an employee and sent her to Dallas for a week to contact prospective out-of-state clients. Joe ended up reimbursing his employee $300 for airfare, $350 for lodging, $250 for meals, and $150 for entertainment. Joe requires the employee to account for all expenditures in order to be reimbursed. g. Joe uses his BMW (a personal auto) to travel to and from his residence to his factory. However, he switches to a business vehicle if he needs to travel after he reaches the factory. Last month, the business vehicle broke down and he was forced to use the BMW both to travel to and from the factory 8-48 chapter 8 Business Income, Deductions, and Accounting Methods and to visit work sites. He drove 120 miles visiting work sites and 46 miles driving to and from the factory from his home. h. Joe paid a visit to his parents in Dallas over the Christmas holidays. While he was in the city, Joe spent $50 to attend a half-day business symposium. Joe paid $200 for airfare, $50 for meals during the symposium, and $20 on cab fare to the symposium.
Question 4
QUESTION #1 (20 Marks; Maximum 5 marks for each scenario) REQUIRED: For EACH of the 4 scenarios described below provide the following information: I) the appropriate investment portfolio asset allocation that you would recommend (i.e. what percentage would you put into Cash, Fixed Income and Equity) (2 Mark maximum for each scenario); II) the types of investments within each asset class (i.e. for the Fixed Income category; would you recommend GIC?s Bonds, Treasury Bills, etc.) (2 Mark maximum for each scenario); III) your detailed rational for your recommendation (1 Mark maximum for each scenario). Scenario #1: Single individual aged 28; No financial dependents; Graduated from York U. Business Program 6 years ago and recently completed his CFP designation. He has been working as an Assistant Finance Manager at TD Bank for 4 years. Positive cash flow of $400 per month; No student loans or other debt. Recently inherited a house and $200,000 in cash. Scenario #2: Parents (age 35) of three minor children, all under the age of 10; Expecting their 4th child; Renting an expensive but small, 2 bedroom apartment; Positive cash flow of $500 per month; Investments of $80,000 in their non-registered investment account and $30,000 in a RESP account. Scenario #3: Senior couple (both aged 75 years old); No financial dependents; Renting their apartment; Only investment is a $100,000, 30 day term deposit (earning 1 ?% interest) in a non-registered investment account. The term deposit is maturing this week; Negative monthly cash flow of $700 per month; Only income for both is their Old Age Security (OAS) and Canada Pension Plan (CPP). Scenario #4 A married, working couple who will both retire within 5 years at age 65; No children; $20,000 in cash in their chequing account, $150,000 in non-registered investment account (all GICs) and $300,000 in total in their RRSP accounts Upon retirement in 5 years, they will receive OAS, CPP and $5,500 in total from their private/employer pension plans; They expect to have a significant positive cash flow in retirement; At age 71, they are required to convert the RRSP to RRIF?s and to begin RRIF withdrawals at age 72, which will increase the positive cash flow; Both are healthy and expect to live until age 90; Their Wills indicate that they intend to leave all of their assets to their favourite charity when they die. QUESTION #6 (12 Marks) This question relates to the Canada Deposit Insurance Corporation (CDIC). REQUIRED: Answer the following questions: (a)What is the purpose of this organization? (2 Marks) (b)What investments are covered (insured) under this Act? (2 Marks) (c)What is excluded from this insurance? (4 Marks, 1 mark each) (d)Explain the CDIC coverage for the following scenario (4 Marks; 1 Mark each): Your client has the following joint deposits at a CDIC member institution: (1)Eligible deposits worth $75,000 held with a spouse; (2)Eligible deposits worth $75,000 held with a spouse and a minor child; (3)Eligible deposits worth $125,000 held with two business partners; (4)A term deposit that matures in 2 years (2014), originally purchased in 2004.,I have ever submitted another assignment. This is the second assignment. I want the answer more sepecific and detail following the instructions.,I have spent total $210 on coursehero because I trust coursehero. So please make sure my assignment quality. Take a little more time. Thank you.,i want you to add something to my question1: investment objective 1. long term investment or 2. mid term investment 3. short term investment objective: 1. safety of principal ?conservative, short term? 2. liquidity ?conservative, short term? 3. income/cash flow ?balanced, mid term or long term? 4. growrh ?higher risk, longer term? i want to add it on first requirement.,You mean that I need to create a post(that need additional money)? But it is on the same questions. I just want to add investment objective into the portfolio. objective: 1. safety of principal ?conservative, short term? 2. liquidity ?conservative, short term? 3. income/cash flow ?balanced, mid term or long term? 4. growrh ?higher risk, longer term?
Question 5
Which of the following costs would be classified as a prevention cost on a quality report? Reliability engineering.? Materials inspection.? Rework.? Warranty repairs.? Out-of-court liability settlements.? The provisions of section 302 of the Sarbanes-Oxley Act (as originally enacted) require the signing officers of a company to do all of the following except: Audit the internal controls over financial reporting.? Establish the internal controls over financial reporting.? Maintain the internal controls over financial reporting.? Evaluate the internal controls over financial reporting.? Disclose material weaknesses in the internal controls over financial reporting.? A manufacturer's raw-material purchasing department would likely be classified as a: cost center.? revenue center.? profit center.? investment center.? contribution center.? A general calculation method for transfer prices that achieves goal congruence begins with the additional outlay cost per unit incurred because goods are transformed and then adds the opportunity cost per unit to the organization because of the transfer.? subtracts the opportunity cost per unit to the organization because of the transfer.? adds the sunk cost per unit to the organization because of the transfer.? subtracts the sunk cost per unit to the organization because of the transfer.? adds the sales revenue per unit to the organization because of the transfer.? A responsibility center in which the manager is held accountable for the profitable use of assets and capital is commonly known as a(n): cost center.? revenue center.? profit center.? investment center.? contribution center. Controllable costs, as used in a responsibility accounting system, consist of: only fixed costs.? only direct materials and direct labor.? those costs that a manager can influence in the time period under review.? those costs about which a manager has some knowledge.? those costs that are influenced by parties external to the organization.? The Little Rock Division of Classics Companies currently reports a profit of $3.6 million. Divisional invested capital totals $9.5 million; the imputed interest rate is 12%. On the basis of this information, Little Rock's residual income is: $432,000.? $708,000.? $1,140,000.? $2,460,000.? some other amount.? Sand Fly Corporation operates two stores: J and K. The following information relates to J:?Sales revenue $1,300,000?Variable operating expenses 600,000?Fixed expenses:? Traceable to J and controllable by J 275,000? Traceable to J and controllable by others 80,000?J's segment contribution margin is: $345,000.?? $425,000.?? $620,000.?? $700,000.?? $745,000. The basic idea behind residual income is to have a division maximize its: earnings per share.? income in excess of a corporate imputed interest charge.? cost of capital.? cash flows.? invested capital.? ROI is most appropriately used to evaluate the performance of: cost center managers.? revenue center managers.? profit center managers.? investment center managers.? both profit center managers and investment center managers.? The difference between the profit margin controllable by a segment manager and the segment profit margin is caused by: variable operating expenses.? allocated common expenses.? fixed expenses controllable by the segment manager.? fixed expenses traceable to the segment but controllable by others.? sales revenue. Sunrise Corporation has a return on investment of 15%. A Sunrise division, which currently has a 13% ROI and $750,000 of residual income, is contemplating a massive new investment that will (1) reduce divisional ROI and (2) produce $120,000 of residual income. If Sunrise strives for goal congruence, the investment: should not be acquired because it reduces divisional ROI.? should not be acquired because it produces $120,000 of residual income.? should not be acquired because the division's ROI is less than the corporate ROI before the investment is considered.? should be acquired because it produces $120,000 of residual income for the division.? should be acquired because after the acquisition, the division's ROI and residual income are both positive numbers.? Which of the following bodies oversees audits and auditors, and sanctions firms and individuals for violations of laws and regulations? American Institute of Certified Public Accountants (AICPA).? American Accounting Association (AAA).? Public Company Accounting Oversight Board (PCAOB).? Financial Accounting Standards Board (FASB).? Accounting Principles Board (APB).? When managers of subunits throughout an organization strive to achieve the goals set by top management, the result is: goal congruence.? planning and control.? responsibility accounting.? delegation of decision making.? strategic control. Which of the following is the correct mathematical expression to derive a company's capital turnover? Sales revenue / invested capital.? Contribution margin / invested capital.? Income / invested capital.? Invested capital / sales revenue.? Invested capital / income. Which of the following describes the goal that should be pursued when setting transfer prices? Maximize profits of the buying division.? Maximize profits of the selling division.? Allow top management to become actively involved when calculating the proper dollar amounts.? Establish incentives for autonomous division managers to make decisions that are in the overall organization's best interests (i.e., goal congruence).? Minimize opportunity costs.? Weston Company had sales revenue and operating expenses of $5,000,000 and $4,200,000, respectively, for the year just ended. If invested capital amounted to $6,000,000, the firm's ROI was: 13.33%.? 83.33%.? 120.00%.? 750.00%.? some other figure.? The amounts charged for goods and services exchanged between two divisions are known as: opportunity costs.? transfer prices.? standard variable costs.? residual prices.? target prices. Under section 404 of the Sarbanes-Oxley Act, auditors are required to: Attest to and report on management's assessment of internal controls.? Establish and maintain internal controls for audited companies.? Advise management on its preparation of the Report on Internal Controls.? Evaluate the company's internal control system periodically throughout the year.? All of these. Which of the following is an appropriate base to distribute the cost of building depreciation to responsibility centers? Number of employees in the responsibility centers.? Budgeted sales dollars of the responsibility centers.? Square feet occupied by the responsibility centers.? Budgeted net income of the responsibility centers.? Total budgeted direct operating costs of the responsibility centers.?
