Question 1
The following trial balance is for Jackson Sales Company, a home improvement retailer, at January 1, 2012: Debit Credit Cash $49,950 Accounts Receivable 14,000 Allowance for Doubtful Accounts $2,600 Merchandise Inventory 20,200 Land 50,000 Buildings 81,000 Accumulated Depreciation ? Buildings 37,500 Equipment 45,000 Accumulated Depreciation ? Equipment 18,000 Accounts Payable 3,750 Notes Payable 38,500 Common Stock, $10 par 40,000 Retained Earnings 119,800 $260,150 $260,150 PART 1?TRANSACTIONS ? 150 points INSTRUCTIONS: Journalize the appropriate entries for the following transactions for the period January 1, 2012 to December 31, 2012. The company uses a perpetual inventory system and FIFO cost method. Beginning inventory on January 1 consisted of 1,000 units at $20.20 per unit. February 1 Paid $3,750 accounts payable balance due to a supplier. March 15 Received $2,500 partial payment on a $5,000 accounts receivable balance. Wrote off the rest of the account as uncollectible. April 1 April 15 Purchased on account 2,500 units merchandise for resale at $21.50 per unit, with 2/10, n/30 terms. Paid the invoice for April 1 purchase October 10 Sold 700 units of merchandise for a cash price of $40/unit. November 1 Borrowed $20,000 at 6% interest for 5 years with annual payments of principal and interest on October 31. Used the loan proceeds plus cash to purchase a $25,000 delivery truck. December 1 Bought back 500 shares of outstanding stock, paying $15/share. December 5 Sold 2,400 units of merchandise on account for $41/unit. Payment terms on the invoice were 1/10, n/30. December 7 Of the merchandise sold on December 5, 50 units were returned. December 15 Paid $3,000 for rent of a warehouse facility. The payment covers rent for December and January. December 15 Declared a $1/share cash dividend, payable January 14 to shareholders of record on January 3. December 18 Purchased office supplies of $1,600 on account. December 31 Recorded depreciation for the year Buildings have a 30-year life, a $6,000 residual value and use straight-line depreciation Equipment has a 5-year life, no residual value and use double-declining balance depreciation NOTE: Equipment was all purchased January 1, 2011 Vehicles have a 5-year life, no residual value and use straight-line depreciation December 31 The allowance for doubtful accounts balance is estimated as follows: 2% of current balances are estimated as uncollectible 20% of past-due balances are estimated as uncollectible. December 31 A count of office supplies shows $550 still on hand on December 31. January 2, 2013 Paid salaries of $24,500 for the pay period December 31 through January 4. Salaries are earned evenly during the pay period. PART 2 ? TRIAL BALANCE ? 30 points INSTRUCTIONS: Prepare a trial balance as of December 31, 2012. PART 3?FINANCIAL STATEMENTS ? 120 points INSTRUCTIONS: Prepare a December 31, 2012 Classified Balance Sheet, Classified Income Statement and Statement of Cash Flows
Question 2
Please answer the questions below in essay format (approximately 500 words each) using specific examples (dates, groups, laws, etc.) to explain your answer. 1. What are the differences and similarities between public and private sector unions? Include methods of organizing, organization structure, legislation, right to strike, reasons employees organize, and what the future might hold for each. 2. You are the Human Resource Director for a company that includes a large clerical staff supervised by a female manager. The staff consists of 22 females and one male. The male clerical worker has come to you accusing the manager of sexual harassment. The employee claims that in meetings the manager frequently makes derogatory remarks about men in general and emails cartoons and jokes to the staff that he finds demeaning. He is not comfortable talking to the manager about this issue because he knows she is a man hater. He wants to file a complaint with the state Human Relations Commission, but he is afraid if he does so that the manager will give him an unsatisfactory review which will jeopardize his job. a. How will you proceed? Include the steps you will take to investigate this claim, what resources you will consult and whether this is, indeed, sexual harassment. Finally, based on your findings, what will you do to resolve this issue? Please answer the questions below in essay format (each a minimum 250 words) using specific examples (dates, groups, laws, etc.) to explain your answer. 3. Compare and contrast the current working conditions in sweat shops overseas with the labor conditions in the United States in the early 20th century (1900?s). 4. Describe the characteristics of arbitration hearings. Include in your description the roles of the people involved. Compare and contrast a typical arbitration hearing with a court proceeding.
Question 3
Stephenson Real Estate Company was founded 25 years ago by the current CEO, Robert Stephenson. The company purchases real estate, including land and buildings, and rents the property to tenants. The company has shown a profit every year for the past 18 years, and the shareholders are satisfied with the company?s management. Prior to founding Stephenson Real Estate, Robert was the founder and CEO of a failed alpaca farming operation. The resulting bankruptcy made him extremely averse to debt financing. As a result, the company is entirely equity financed, with 20 million shares of common stock outstanding. The stock currently trades at $35.50 per share. Stephenson is evaluating a plan to purchase a huge tract of land in the southeastern United States for $60 million. The land will subsequently be leased to tenant farmers. This purchase is expected to increase Stephenson?s annual pretax earnings by $14 million in perpetuity. Kim Weyand, the company?s current new CFO, has been put in charge of the project. Kim has determined that the company?s current cost of capital is 12.5 percent. She feels that the company would be more valuable if it included debt in its capital structure, so she is evaluating whether the company should issue debt to entirely finance the project. Based on some conversations with investment banks, she thinks that the company can issue bonds at par value with an 8 percent coupon rate. Based on her analysis, she also believes that a capital structure in the range of 70 percent equity/30 percent debt would be optimal. If the company goes beyond 30 percent debt, its bonds would carry a lower rating and a much higher coupon because the possibility of financial distress and the associated costs would rise sharply. Stephenson has a 40 percent corporate tax rate (state and federal). 1) Explain whether Stephenson should issue debt or equity to finance the land purchase.
Question 4
Chapter 10: Questions 1, 7, 8, and 19 1. 1. Georgia Lazenby believes a current liability is a debt that can be expected to be paid in one year. Is Georgia correct? Explain. 2. 7. (a) What are long-term liabilities? Give two examples. (b) What is a bond? 3. 8. Contrast these types of bonds: (a) Secured and unsecured. (b) Convertible and callable. 5. 19. Valentin Zukovsky says that liquidity and solvency are the same thing. Is he correct? If not, how do they differ? Chapter 10: BE 10-1 6. BE 10-1. Kananga Company has these obligations at December 31: (a) a note payable for $100,000 due in 2 years, (b) a 10-year mortgage payable of $200,000 payable in ten $20,000 annual payments, (c) interest payable of $15,000 on the mortgage, and (d) accounts payable of $60,000. For each obligation, indicate whether it should be classified as a current liability. Chapter 11: BYP11-10 7. BYP11-10. Greenwood Corporation has paid 60 consecutive quarterly cash dividends (15 years). The last 6 months have been a real cash drain on the company, however, as profit margins have been greatly narrowed by increasing competition. With a cash balance sufficient to meet only day-to-day operating needs, the president, Gil Mailor, has decided that a stock dividend instead of a cash dividend should be declared. He tells Greenwood's financial vice-president, Vicki Lemke, to issue a press release stating that the company is extending its consecutive dividend record with the issuance of a 5% stock dividend. "Write the press release convincing the stockholders that the stock dividend is just as good as a cash dividend," he orders. "Just watch our stock rise when we announce the stock dividend; it must be a good thing if that happens." Instructions (a) Who are the stakeholders in this situation? (b) Is there anything unethical about president Mailor's intentions or actions? (c) What is the effect of a stock dividend on a corporation's stockholders' equity accounts? Which would you rather receive as a stockholder-a cash dividend or a stock dividend? Why? Chapter 11: Assignment 11-1 8. PROBLEM 11.1 Early in 2002, Robbinsville Press was organized with authorization to issue 100,000 shares of $100 par value preferred stock and 500,000 shares of $1 par value common stock. Ten thousand shares of the preferred stock were issued at par, and 170,000 shares of common stock were sold for $15 per share. The preferred stock pays an 8 percent cumulative dividend. During the first four years of operations (2002 through 2005), the corporation earned a total of $1,085,000 and paid dividends of 75 cents per share in each year on its outstanding common stock. Instructions a. Prepare the stockholders' equity section of the balance sheet at December 31, 2005. Include a supporting schedule showing your computation of the amount of retained earnings reported. (Hint: Income increases retained earnings, whereas dividends decrease retained earnings.) b. Are there any dividends in arrears on the company's preferred stock at December 31, 2005? Explain your answer.
Question 5
Directions: Review the SPSS output file which reports the results of the between-group (independent group) factorial ANOVA to see if the mean alcohol by volume (%) differs as a function of rating given by beer expert (IV 1) and/or recommendation made by a beer connoisseur magazine (IV 2). Answer the following questions based on your observations of the SPSS output file: 1. Is the mean alcohol by volume level different for the type of rating given by the beer expert (main effect of IV1)? What are F-value and the significance level for this test (write result using the following notation: F(df1, df2) = _____, p = _____). 2. Is the mean alcohol by volume level different for the type of recommendation given by the beer magazine? What are F-value and the significance level for this test (write result using following notation: F(df1, df2) = _____, p = _____). 3. Is the mean alcohol by volume level different for different combinations of expert rating and magazine recommendation (interaction term)? What are F-value and the significance level for this test (write result using following notation: F(df1, df2) = _____, p = _____). Review the SPSS output file, which reports the results of computing the Pearson product-moment correlation coefficient to examine the possible relationship between the number of calories in a brand of beer and its alcohol by volume. Answer the following questions based on your observations of the SPSS output file: 1. Looking at the correlations table, what is the r-value for the correlation between these two variables? 2. Is that r-value statistically significant? What is the 2-tailed significance? 3. Write the results in the following format: r(df value) = ____, p = _____
