Question 1
Dan Barnes, financial manager of SKI casts, is requesting a line of credit from the company's bank. The company has produced the following sales estimates: $71,218 in November, $68,212 in December, $65,213 in January, $52,475 in February, $42,909 in March, $30,524 in April, $44,567 in May, $54,590 in June, $62,341 in July, and $70,132 in August. Collection estimates are as follows: 20 percent within the month of sale, 70 percent in the month following the sale, and 10 percent in the second month following the sale. The company allows a 2 percent discount on payments made during the month of sales. Plaster supplies expense is estimated as 85 percent of sales two months from now. Other relevant information is as follows: - Payments for plaster supplies is made during the month following the one in which these costs have been incurred. - Wages and salaries will amount to approximately $6,691 in January, $5,471 in February, $4,316 in March, $3,126 in April, $4,511 in May, and $5,629 in June. - Lease payments under long-term lease contracts will be $2,500 a month. - Depreciation charges will be $600 a month. - Income tax payments of $8,000 will be due in March and June; - A progress payment of $10,000 on a new building must be paid in April. - Cash on hand on January 1 will amount to $3,000, and a minimum cash balance of $1,500 will be maintained throughout the cash budget period. a. What is the maximum loan that the company will require between January and June?
Question 2
"1-2 1. Rule 203 of the AICPA?s Code of Professional Conduct pertains to a. CPAs? independence b. authorities designated to establish accounting standards c. standards of competency d. solicitation of new clients by a CPA 2. Which of the following rule-making authorities would establish accounting standards for Stanford University (a private university)? a. the AICPA b. the FASB c. the FASAB d. the GASB 3. Which of the following rule-making authorities would establish accounting standards for the University of Texas (a public university)? a. the AICPA b. the FASB c. the FASAB d. the GASB 4. If the GASB has not issued a pronouncement on a specific issue, which of the following is true with respect to FASB pronouncements? a. they would automatically govern b. they could be taken into account but would have no higher standing than other accounting literature c. they are irrelevant d. they could be taken into account by the reporting entity, but only if disclosure is made in notes to the financial statements 5. The FASB is to the GASB as a. a brother is to a sister b. a father is to a son c. a son is to a father d. a daughter is to a friend 6. Standards promulgated by the FASB are most likely to be adhered to by which of the following governmental units? a. a police department b. a public school c. an electric utility d. a department of highways 7. Which of the following practices is most likely to undermine interperiod equity? a. paying for a new school building out of current operating funds b. paying the administrative staff of a school out of current operating funds c. issuing 20-year bonds to finance construction of a new highway d. recognizing gains and losses on marketable securities as prices increase and decrease 8. The term ??independent sector?? refers to a. states that have opted not to receive federal funds b. not-for-profit organizations c. churches that are unaffiliated with a particular denomination d. universities that are not affiliated with a particular athletic conference 9. Which of the following is not an objective of external financial reporting by either the GASB or the FASB? a. to enable the statement user to detect fraud b. to disclose legal or contractual restrictions on the use of resources c. to provide information about how the organizations meet their cash requirements d. to provide information that would enable a user to assess the service potential of longlived Assets 10. Which of the following is the least appropriate use of the external financial statements of a government? a. to assess the entity?s financial position b. to assess whether the compensation of management is reasonable in relation to that in comparable entities c. to compare actual results with the budget d. to evaluate the efficiency and effectiveness of the entity in achieving its objectives 1-3 Budgeting practices that satisfy cash requirements may not promote interperiod equity. The Burnet County Road Authority was established as a separate government to maintain county highways. The road authority was granted statutory power to impose property taxes on county residents to cover its costs, but it is required to balance its budget, which must be prepared on a cash basis. In its first year of operations it engaged in the following transactions, all of which were consistent with its legally adopted, cash-based budget: Purchased $10 million of equipment, all of which had an anticipated useful life of 10 years. To finance the acquisition, the authority issued $10 million in 10-year term bonds (i.e., bonds that mature in 10 years) Incurred wages, salaries, and other operating costs, all paid in cash, of $6 million Paid interest of $0.5 million on the bonds Purchased $0.9 million of additional equipment, paying for it in cash. This equipment had a useful life of only three years 1. The authority?s governing board levies property taxes at rates that are just sufficient to balance the authority?s budget. What is the amount of tax revenue that it is required to collect? 2. Assume that in the authority?s second year of operations, it incurs the same costs, except that it purchases no new equipment. What amount of tax revenue is it required to collect? 3. Make the same assumption as to the tenth year, when it has to repay the bonds. What amount of tax revenue is it required to collect? 4. Comment on the extent to which the authority?s budgeting and taxing policies promote interperiod equity. What changes would you recommend? 1-4 The dual objectives of assessing interperiod equity and ensuring budgetary compliance may necessitate different accounting practices. A city engages in the transactions that follow. For each transaction, indicate the amount of revenue or expenditure that it should report in 2012. Assume first that the main objective of the financial statements is to enable users to assess budgetary compliance. Then assume alternatively that the main objective is to assess interperiod equity. The city prepares its budget on a ??modified?? cash basis (that is, it expands the definition of cash to include short-term marketable securities), and its fiscal year ends on December 31. 1. Employees earned $128,000 in salaries and wages for the last five days in December 2012. They were paid on January 8, 2013. 2. A consulting actuary calculated that, per an accepted actuarial cost method, the city should contribute $225,000 to its firefighters? pension fund for 2012. However, the city contributed only $170,000, which is the amount budgeted at the start of the year. 3. The city acquired three police cars for $35,000 cash each. The vehicles are expected to last for three years. 4. OnDecember 1, 2012, the city invested $99,000 in short-term commercial paper (promissory notes). The notes matured January 1, 2013. The city received $100,000. The $1,000 difference between the two amounts represents the city?s return (interest) on the investment. 5. On January 2, 2012, the city acquired a new $10 million office building, financing it with 25-year serial bonds. The bonds are to be repaid evenly over the period during which they are outstanding?that is, $400,000 per year. The useful life of the building is 25 years. 6. On January 1, 2012, the city acquired another $10 million office building, financing this facility with 25-year term bonds. These bonds will be repaid entirely when they mature January 1, 2037. The useful life of this building is also 25 years. 7. City restaurants are required to pay a $1,200 annual license fee, the proceeds of which the city uses to fund its restaurant inspection program. The license covers the period July 1 through June 30. In 2012 the city collected $120,000 in fees for the license period beginning July 1, 2012. 8. The city borrowed $300,000 in November 2012 to cover a temporary shortage of cash. It expects to repay the loan in February 2013. 1-5 Year-end financial accounting and reporting can reveal the economic substance of government actions that have been taken mainly to balance the budget. Public officials, it is often charged, promote measures intended to make the government ??look good?? in the short-term, but that may be deleterious in the long term. Assume that a city?s budget is on a cash or near-cash basis. Further assume that the following actions, designed to increase a reported surplus, were approved by the city council and did indeed reduce budgetary expenditures or increase budgetary revenues: a. The city reduced its contributions to the employee defined benefit pension plan from the $10 million recommended by the city?s actuary to $5 million. Under a defined benefit plan, the employer promises employees specified benefits upon their retirement, and the level of benefits is independent of when and how much the employer contributes to the plan over the employees? years of service. b. It reduced by $1 million the city?s cash transfer to a rainy-day reserve that is maintained to cover possible future reductions in tax collections attributable to a downturn in the region?s economy. c. It sold securities that had been held as an investment. The securities had been purchased five years earlier at a cost of $2 million. Market value at the time of sale was $5 million. d. It delayed until the following year $10 million of maintenance on city highways. 1. Suppose that you were asked to propose accounting principles for external reporting that would capture the true economic nature of these measures?actions that, in substance, did not improve the city?s financial performance or position. For each measure, indicate how you would require that it be accounted for and reported. 2. Can you see any disadvantages to the principles that you propose? 1-6 Choice of accounting principles may have significant economic consequences. In preparing its budget proposals, a city?s budget committee initially estimated that total revenues would be $120 million and total expenditures would be $123 million. In light of the balanced budget requirements that the city has to meet, the committee proposed several measures to either increase revenues or decrease expenditures. They included the following: a. Delay the payment of $0.4 million of city bills from the last week of the fiscal year covered by the budget to the first week of the next fiscal year. b. Change the way property taxes are accounted for in the budget. Currently, property taxes are counted as revenues only if they are expected to be collected during the budget year. New budgetary principles would permit the city to include as revenues all taxes expected to be collected within 60 days of the following fiscal year, in addition to those collected during the year. The committee estimates that the change would have a net impact of $1.2 million . c. Change the way that supplies are accounted for in the budget. Currently, supplies are recognized as expenditures at the time they are ordered. The proposal would delay recognition of the expenditure until the supplies are actually received. The committee estimates a net effect of $0.8 million. d. Defer indefinitely $1.5 million of maintenance on city roads. Except as just noted with respect to supplies, the city currently prepares its budget on a cash basis, even though other bases are also legally permissible. It prepares its year-end financial statements, however, on an accrual basis. 1. Indicate the impact of each of the proposals on the city?s (1) budget, (2) annual year-end financial statements, (3) ??substantive?? economic well-being. Be sure to distinguish between direct and indirect consequences. 2. It is sometimes said that choice of accounting principles doesn?t matter in that the principles affect only the way in which the entity?s fiscal ??story?? is told; they have no impact on the entity?s actual financial history or current status. Do you agree? Explain.,Have you accepted the assignment and deadline?
Question 3
Assignment 1: Vice President of Operations, Part 1 Due Week 3 and worth 200 points Scenario: Imagine that you are the vice president of operations at a production or service organization. You have noticed that your organization?s current operations strategy is not supporting the challenges that the organization is presently facing. In order to maintain a competitive edge, you must address these challenges with your Chief Executive Officer immediately. Select an existing production organization. Analyze the organization?s current vision, mission, business strategy, operation strategy, supply chain, total quality management, just-in-time philosophy, forecasting method, statistical technique, facility location, work design, project life cycle, and project management. Note: You will need this information in order to complete this and subsequent assignments. As you collect the information for Assignment 1 and Assignment 2, remember that in Assignment 3 you must prepare a presentation for your Chief Executive Officer. Write a three to five (3-5) page paper in which you: 1.Evaluate key elements of the selected production or service organization?s operational efficiency with its operational strategy. Determine three (3) tasks that do not align with the operational strategy. Determine the weaknesses that are evident in each task. 2.Formulate a new operations strategy for the selected organization based on the four (4) competitive priorities (i.e., cost, quality, time, and flexibility). 3.Analyze both the structure of the competitive priorities and infrastructure of the production process. Develop three (3) new enablers that are aligned with the long-term plan of the selected organization. Evaluate three (3) pros and three (3) cons of the new enablers. 4.Use at least three (3) quality academic resources in this assignment. Note: Wikipedia and other Websites do not quality 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. The specific course learning outcomes associated with this assignment are: ?Analyze the differences between service and manufacturing operations management to identify planning considerations. ?Formulate an operations strategy to conduct production or service operations. ?Explain how an operations strategy impacts product design and process selection.Use technology and information resources to research issues in operations management. ?Write clearly and concisely about operations management using proper writing mechanics.
Question 4
22. Which of the following will most likely help identify an increasing proportion of uncollectible sales? (Points : 2) a. accounts receivable turnover b. the ratio of bad debt expense to sales c. the ratio of sales returns to sales d. the ratio of cost of sales to sales 23. Under the percentage-of-completion contract method (Points : 2) a. revenue and cost are recognized during the production cycle, but gross profit recognition is deferred until the contract is completed. b. revenue, cost, and gross profit are recognized during the production cycle. c. revenue, cost, and gross profit are recognized at the time the contract is completed. d. none of these 26. All of the following are conditions for revenue recognition outlined by SAB 104 except: (Points : 2) a. There is pervasive evidence that an arrangement exists. b. Delivery has occurred or services have been performed. c. The seller?s price to the buyer can be variable. d. Collectability is reasonably assured. 27. Upton Company has consistently used the percentage-of-completion method of recognizing income. In 2010, Upton started on an $18,000,000 construction contract that was completed in 2012. The following information was taken from Upton?s 2010 accounting records: Progress billing $ 6,600,000 Costs incurred $ 5,400,000 Collections $ 4,200,000 Estimated costs to complete $10,800,000 What amount of revenue should Upton recognize on the contract in 2010? (Points : 2) a. $6,000,000 b. $5,400,000 c. $9,000,000 d. $0 28. The projected benefit obligation measures (Points : 2) a. the pension obligation on the basis of the plan formula applied to years of service to date and based on existing salary levels. b. an estimated total benefit at retirement and then computes the level cost that will be sufficient, together with interest expected to accumulate at the assumed rate, to provide the total benefits at retirement. c. the pension obligation on the basis of the plan formula applied to years of service to date and based on future salary levels. d. the shortest possible period for funding to maximize the tax deduction. 29. Academic research has found that market rates of return on common stock are the most highly correlated with (Points : 2) a. net income. b. cash flow from operations. c. EBITDA. d. cash flow from investing activities. 30. As products move through the maturity phase, companies invest to ___________ productive capacity. (Points : 2) a. increase b. decrease c. maintain d. Not enough information to answer this question. 41. All of the following statements are true regarding ratios and forecasts except: (Points : 2) a. Ratios cannot confirm whether forecast assumptions will turn out to be correct. b. Ratios can tell whether future sales growth was accurately captured. c. Ratios cannot tell whether assumptions about future cash flows are realistic. d. Ratios can tell whether growth rates for sales are consistent with past sales growth performance. 42. An analyst using the inventory turnover ratio to calculate future levels of inventory may face the problem that (Points : 2) a. the method reduces the potential understatement inherent in average balances. b. the method can introduce artificial volatility in ending balances. c. the method results in understating inventory each year. d. the method results in overstating inventory each year. 43. Financial statement forecasts rely on additivity within financial statements and articulation across financial statements. Given this information sales growth forecasts will most likely affect growth in (Points : 2) a. accounts receivables. b. accounts payable. c. depreciation. d. salary payable. 44. Sparky?s Sparky?s sells auto parts. Provided below is selected financial information from the company?s 2012 annual report: Sparky?s Selected Financial Statement data Fiscal year end 2012 2011 (amounts in thousands of dollars) Net sales $125,410 $106,380 Cost of Goods Sold -104,090 -89,359 Gross Profit $21,320 $17,021 Inventory $31,353 $30,850 Sparky?s forecasts that sales will grow by 25% in 2013 and that its cost of goods sold to sales ratio will be the same in 2013 as it was in 2012. If these assumptions prove correct and Sparky?s inventory turnover ratio for 2013 is 4.5 what will be the level of inventory at the end of 2013? (Points : 2) a. $31,353 b. $38,320 c. $40,000 d. $42,314 45. Which of the following statements does not apply to preventing ?garbage in, garbage out? when implementing a forecasting game plan? (Points : 2) a. The quality of the financial statement forecasts will depend on the quality of the b. forecast assumptions. c. The quantities forecasted within financial statement forecasts will depend on the quantity of the forecast assumptions. d. Analysts should justify and evaluate the most important assumptions that reflect the critical risk and success factors of the firm?s strategy. e. Analysts can impose reality checks on the assumptions by analyzing the forecasted financial statements using ratios, common-size, and rate-of-change financial statements. 46. As a firm progresses through the introduction life-cycle stage, what type of flexible account will it be more likely to use to balance the balance sheet? (Points : 2) a. dividends. b. growth related assets. c. issued equity. d. stock buy-backs. 48. If a firm competes in a capital-intensive industry with excess capacity, all of the following are true except: (Points : 2) a. price increases will be less likely. b. price increases will be more likely. c. companies in competitive industries face high exit barriers. d. companies in competitive industries may experience future price decreases.
Question 5
Unit 5 Assignment: Applying Ethics Read the article, ?Unmasking the Myths: Learning to Navigate the Rough Seas of Ethics? located in the ATACHEMENT. Organizations have at their disposal many tools to help create the desired organizational cultural. Discuss how a company may use at least three of the organizational tools (instruments) discussed in the paper to help dispel the three beliefs (or myths) and support the U. N. Global Compact Principles? The document should be 5 ? 7 pages, well-referenced and in APA format. IT IS VERY IMPORTANT THAT THE PAPER BE APA FORMAT AND WELL REFERENCED. APA Required Format as follows. References listed on the Reference page should be cited in the text. Please use in-text citations, consistent with APA formatting. In-text citations give credit to other authors and highlights areas in the paper that are explicitly not your original work. Content requires, ?References are applied substantively to the paper topic?. Absent in-text citations, the paper does not address this content requirement. Similarly, Analysis requires a demonstration of, ?strong higher-order critical thinking and analysis?. If your thoughts and analysis are not distinguished from those of other authors, assessing your analytical ability is difficult. The following formatting issues should be addressed for future papers: APA formatting requires a title page, there should be a page break to separate the reference page from the body of the text, and include a running header. Separate paragraphs with indentions. Indented paragraphs increase the quality of the content and readability of the paper the text should be double spaced and new paragraphs should be indented. Your score for this paper was based on the following rubric: Direct quotes may constitute no more than 10-15% of student papers and assignments. Excessive quotation ? more than 15% - does not reflect the student?s original thinking. Submissions with excessive quotation will be marked down for lack of originality.
