Question 1
E 15?5: Sales-type lease; lessor LO15?6 - Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2013. International Machines manufactured the equipment at a cost of $85,000. Required: 1. Show how International Machines determined the $15,000 quarterly rental payments. 2. Prepare appropriate entries for International Machines to record the lease at its inception, January 1, 2013, and the second rental payment on April 1, 2013. E 15?8: Capital lease; lessee; balance sheet and income statement effects On June 30, 2013, Georgia-Atlantic, Inc., leased a warehouse facility from IC Leasing Corporation. The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $562,907 over a three-year lease term, payable each June 30 and December 31, with the first payment at June 30, 2013. Georgia-Atlantic?s incremental borrowing rate is 10%, the same rate IC uses to calculate lease payment amounts. Depreciation is recorded on a straight-line basis at the end of each fiscal year. The fair value of the warehouse is $3 million. Required: 1. Determine the present value of the lease payments at June 30, 2013 (to the nearest $000) that Georgia-Atlantic uses to record the leased asset and lease liability. 2. What pretax amounts related to the lease would Georgia-Atlantic report in its balance sheet at December 31, 2013? 3. What pretax amounts related to the lease would Georgia-Atlantic report in its income statement for the year ended December 31, 2013?
Question 2
On January 1, 2013, JWS Corporation issued $690,000 of 7% bonds, due in 10 years. The bonds were issued for $643,115, and pay interest each July 1 and January 1. JWS uses the effective-interest method. Prepare the company?s journal entries for (a) the January 1 issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry. Assume an effective-interest rate of 8%. (Round answers to 0 decimal places, e.g. $38,548. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit (a) (b) (c) At December 31, 2013, Hyasaki Corporation has the following account balances: Bonds payable, due January 1, 2021 $2,099,000 Discount on bonds payable 115,600 Interest payable 107,400 Show how the above accounts should be presented on the December 31, 2013, balance sheet, including the proper classifications. Hyasaki Corporation Balance Sheet December 31, 2013 Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentRevenuesStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal RevenuesTotal Stockholders' Equity $ Current AssetsCurrent LiabilitiesExpensesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesProperty, Plant and EquipmentRevenuesStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal ExpensesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal RevenuesTotal Stockholders' Equity $ Add Less : $ On January 1, 2013, McLean Company makes the two following acquisitions. 1. Purchases land having a fair value of $392,000 by issuing a 4-year, zero-interest-bearing promissory note in the face amount of $595,084. 2. Purchases equipment by issuing a 6%, 9-year promissory note having a maturity value of $507,000. (interest payable annually). The company has to pay 11% interest for funds from its bank. (a) Record the two journal entries that should be recorded by McLean Company for the two purchases on January 1, 2013. (b) Record the interest at the end of the first year on both notes using the effective-interest method. (Round answers to 0 decimal places, e.g. $38,548.) No. Account Titles and Explanation Debit Credit (a) 1. 2. (b) 1. 2. At December 31, 2012, Redmond Company has outstanding three long-term debt issues. The first is a $2,038,900 note payable which matures June 30, 2015. The second is a $6,004,400 bond issue which matures September 30, 2016. The third is a $12,542,000 sinking fund debenture with annual sinking fund payments of $2,508,400 in each of the years 2014 through 2018. Prepare the required note disclosure for the long-term debt at December 31, 2012. Long-term Debt 2013 $ 2014 $ 2015 $ 2016 $ 2017 $
Question 3
1.Golden Gate Construction Associates, a real estate developer and building contractor in San Francisco, has two sources of long-term capital: debt and equity. The cost to Golden Gate of issuing debt is the after-tax cost of the interest payments on the debt, taking into account the fact that the interest payments are tax deductible. The cost of Golden Gate?s equity capital is the investment opportunity rate of Golden Gate?s investors, that is, the rate they could earn on investments of similar risk to that of investing in Golden Gate Construction Associates. The interest rate on Golden Gate?s $90 million of long-term debt is 10 percent, and the company?s tax rate is 40 percent. The cost of Golden Gate?s equity capital is 15 percent. Moreover, the market value (and book value) of Golden Gate?s equity is $135 million. Required: Calculate Golden Gate Construction Associates? weighted-average cost of capital. 2.Refer to the data in the preceding exercise for Golden Gate Construction Associates. The company has two divisions: the real estate division and the construction division. The divisions? total assets, current liabilities, and before-tatx operating income for the most recent year are as follows: Division Total Assets Current Liabilities Before-Tax Operating Income Real estate .................................................................... $150,000,000 $9,000,000 $30,000,000 Construction ................................................................. 90,000,000 6,000,000 27,000,000 Required: Calculate the economic value added (EVA) for each of Golden Gate Construction Associates? divisions. (You will need to use the weighted-average cost of capital, which was computed in the preceding exercise.)
Question 4
WATERWAYS CONTINUING PROBLEM: WCP21 (This is a continuation of the Waterways Problem from Chapters 14 through 20.) Waterways Corporation is continuing its budget preparations. Waterways had the following static budget and overhead costs for March. Waterways Corporation Waterways Corporation Manufacturing Overhead Budget (Static) Manufacturing Overhead Costs (Actual) For the Month of March For the Month of March Budgeted production in units 117,500 Production in units 118,500 Budgeted costs Costs Indirect materials $ 7,050 Indirect materials $ 7,100 Indirect labor 11,750 Indirect labor 11,825 Utilities 10,575 Utilities 10,700 Maintenance 5,875 Maintenance 5,900 Salaries 42,000 Salaries 42,000 Depreciation 16,800 Depreciation 16,800 Property taxes 2,500 Property taxes 2,500 Insurance 1,200 Insurance 1,200 Janitorial 1,300 Janitorial 1,300 Total budgeted costs $99,050 Total costs $99,325 Waterways produced 118,500 units in March rather than the budgeted number of units. Instructions (a) Prepare a flexible overhead budget based on the following amounts produced. (1) 115,500 units (2) 116,500 units (3) 117,500 units (4) 118,500 units (5) 119,500 units (b) Prepare a flexible budget report showing the differences (favorable and unfavorable) in manufacturing overhead costs for the month of March. (c) Prepare a responsibility report for the manufacturing overhead for March, assuming only variable costs are controllable. WATERWAYS CONTINUING PROBLEM: WCP22 (This is a continuation of the Waterways Problem from Chapters 14 through 21.) Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are not ?ideal? at this point, but the management is working toward that as a goal. At present, the company uses the following standards. Materials Item Per Unit Cost Metal 1 lb. 58? per lb. Plastic 12 oz. 96? per lb. Rubber 4 oz. 80? per lb. Direct Labor Item Per Unit Cost Labor 12 min. $8.00 per hr. Predetermined overhead rate based on direct labor hours = $4.28 The January figures for purchasing, production, and labor are: The company purchased 229,000 pounds of raw materials in January at a cost of 74? a pound. Production used 229,000 pounds of raw materials to make 115,500 units in January. Direct labor spent 15 minutes on each product at a cost of $7.75 per hour. Overhead costs for January totaled $54,673 variable and $63,800 fixed. Instructions Answer the following questions about standard costs. (a) What is the materials price variance? (b) What is the materials quantity variance? (c) What is the total materials variance? (d) What is the labor price variance? (e) What is the labor quantity variance? (f) What is the total labor variance? (g) What is the total overhead variance? (h) Evaluate the variances for this company for January. What do these variances suggest to management?
Question 5
Target Audience & Competition are the next components to be addressed in the process of developing a Marketing Strategy. To choose an appropriate target market, one must understand how consumers make purchase decisions. The body of the paper should 5-6 pages PART 1: General Research 1. Research and discuss Maslow?s theory of needs and how it is applied to marketing. Resources MUST include articles in the library?s full-text databases. 2. Define the stages of the consumer behavior model (or industrial model, if appropriate) and apply how the concepts affect the marketing effort. Research MUST include material from articles in the library?s full-text databases. PART 2: Application to Product/Service (NOTE: this will become part of your Final Strategic Marketing Plan) 1. Provide a quick overview of the product or service for HUHALOS natural hair wigs for men and women. 2. The applications and research in this section will be real. o Identify the target market; Pensacola, FL. Provide a specific demographic profile and rationale for this decision. Using the "US Census Bureau's American Fact Finder". Consider the size of the market and its purchasing power. Research is required to back-up your selection and to provide statistics to show that it is a viable market. o Analyze your competition. Who are they? Who are the biggest players? How large is the market? What are the trends/forecasts in the industry? How does your product/service fit in? Hoover's Pro in the Library is a good tool for this section; it may be accessed under ?Find Web Resources?
