On July 1, Year 1, Danzer Industies Inc. issued $40,000,000 of 10-year, 7% bonds at a market (effective) interest rate of 8%, receiving cash of $37,282,062. Interest on the bonds is payable semiannually on Dec 31 and June 30. The fiscal year of the company is the calendar year. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1. 2. Journalize the entries to record the following. a. The first semiannual interest payment on Dec 31, Year 1, and the amortization of the bond discount, using the straight-line method. Round to the nearest dollar. b. The interest payment on June 30, Year 2, and the amortization of the bond discount, using the straight line method. Round to the nearest dollar. 3. Determine the total interest expense for Year 1. 4. Will the bond proceeds always be less than the face amount of the bonds when the contract rate is less than the market rate of interest? 5. Compare the price of $37,282,062, received for the bonds by using the present value tables. Round to the nearest dollar.
Budget Analysis and Performance Measurement in Decision Making
. Questions 1 to 20: Select the best answer to each question. Note that a question and its answers may be split across a page break, so be sure that you have seen the entire question and all the answers before choosing an answer. 1. Loggin Midwifery’s cost formula for its wages and salaries is $2,380 per month plus $231 per birth. For the month of April, the company planned for activity of 100 births, but the actual level of activity was 102 births. The actual wages and salaries for the month was $25,510. What would the spending variance for wages and salaries in April be closest to? A. $30 F B. $432 U C. $432 F D. $30 U 2. For which cost(s) is a volume variance computed? A. Direct labor costs as well as overhead costs B. Fixed manufacturing overhead only C. Both variable and fixed manufacturing overhead D. Variable manufacturing overhead only 3. Marusarz Corporation has provided the following data concerning its most important raw material, compound F55M: When recording the purchase of materials, what would Raw Materials be? A. Credited for $74,120 B. Credited for $73,270 C. Debited for $74,120 D. Debited for $73,270 4. Krejci Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $41,430 per month plus $2,419 per flight plus $6 per passenger. The company expected its activity in March to be 84 flights and 222 passengers, but the actual activity was 81 flights and 220 passengers. The actual cost for plane operating costs in March was $239,870. What would the plane operating costs in the planning budget for March be closest to? A. $248,754 B. $245,958 C. $238,689 D. $239,870 5. Brletich Corporation keeps careful track of the time required to fill orders. Data concerning a particular order appear below: What was the delivery cycle time? A. 22.5 hours B. 21.1 hours C. 3.7 hours D. 9.1 hours 6. Ok Corporation keeps careful track of the time required to fill orders. Data concerning a particular order appear below: What was the manufacturing cycle efficiency (MCE) closest to? A. 0.12 B. 0.47 C. 0.02 D. 0.07 7. Compound B73G is used to make Vasconcellos Corporation’s major product. The standard cost of B73G is $27.60 per ounce and the standard quantity is 8.6 ounces per unit of output. In the most recent month, 3,200 ounces of the raw material were purchased at a cost of $26.70 per ounce. When recording the purchase of materials, what would Raw Materials be? A. Debited for $85,440 B. Credited for $85,440 C. Debited for $88,320 D. Credited for $88,320 8. Hoang Corporation makes three products that use compound W, the current constrained resource. Data concerning those products appear below: Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized. A. RP,KI,LH B. RP,LH,KI C. LH,RP,KI D. KI,RP,LH 9. Hoppy Corporation compares monthly operating results to a static budget prepared at the beginning of the month. When the actual level of activity is less than budgeted, which of the following would be true? A. Fixed costs would show favorable variances. B. Fixed costs would show unfavorable variances. C. Variable costs would show unfavorable variances. D. Variable costs would show favorable variances. 10. Pettry Snow Removal’s cost formula for its vehicle operating cost is $2,170 per month plus $408 per snow day. For the month of December, the company planned for activity of 16 snow days, but the actual level of activity was 13 snow days. The actual vehicle operating cost for the month was $7,600. What would the vehicle operating cost in the planning budget for December be closest to? A. $7,474 B. $7,600 C. $8,698 D. $9,354 11. A study has been conducted to determine if one of the departments in Barry Corporation should be discontinued. The contribution margin in the department is $60,000 per year. Fixed expenses charged to the department are $75,000 per year. It is estimated that $34,000 of these fixed expenses could be eliminated if the department is discontinued. These data indicate that if the department is discontinued, what would happen to the company’s overall net operating income? A. Decrease by $26,000 per year B. Decrease by $15,000 per year C. Increase by $26,000 per year D. Increase by $15,000 per year 12. Part S00 is used in one of Morsey Corporation’s products. The company makes 6,000 units of this part each year. The company’s Accounting Department reports the following costs of producing the part at this level of activity: An outside supplier has offered to produce this part and sell it to the company for $16.10 each. If this offer is accepted, the supervisor’s salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier’s offer were accepted, only $6,000 of these allocated general overhead costs would be avoided. If management decides to buy part S00 from the outside supplier rather than to continue making the part, what would be the annual impact on the company’s overall net operating income? A. Net operating income would decrease by $65,400 per year. B. Net operating income would decrease by $3,000 per year. C. Net operating income would decrease by $77,400 per year. D. Net operating income would decrease by $71,400 per year. 13. The following standards for variable manufacturing overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: What is the variable overhead efficiency variance for the month? A. $16,817 U B. $17,085 U C. $17,397 U D. $312 F 14. Towne Snow Removal’s cost formula for its vehicle operating cost is $1,470 per month plus $399 per snow day. For the month of November, the company planned for activity of 13 snow days, but the actual level of activity was 9 snow days. The actual vehicle operating cost for the month was $5,230. What would the vehicle operating cost in the flexible budget for November be closest to? A. $5,061 B. $5,230 C. $4,609 D. $6,657 15. Product Q77H has been considered a drag on profits at Zenke Corporation for some time and management is considering discontinuing the product altogether. Data from the company’s accounting system appear below: In the company’s accounting system all fixed expenses of the company are fully allocated to products. Further investigation has revealed that $71,000 of the fixed manufacturing expenses and $43,000 of the fixed selling and administrative expenses are avoidable if product Q77H is discontinued. What would be the effect on the company’s overall net operating income if product Q77H were dropped? A. Overall net operating income would decrease by $95,000. B. Overall net operating income would increase by $95,000. C. Overall net operating income would increase by $4,000. D. Overall net operating income would decrease by $4,000. 16. Wexell Framing’s cost formula for its supplies cost is $1,230 per month plus $10 per frame. For the month of October, the company planned for activity of 592 frames, but the actual level of activity was 597 frames. The actual supplies cost for the month was $7,050. What would the activity variance for supplies cost in October be closest to? A. $50 U B. $50 F C. $100 F D. $100 U 17. Fahringer Corporation makes three products that use compound W, the current constrained resource. Data concerning those products appear below: Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized. A. QR,XS,BJ B. XS,BJ,QR C. BJ,QR,XS D. QR,BJ,XS 18. Cybil Baunt just inherited a 1958 Chevy Impala from her late Aunt Joop. Aunt Joop purchased the car 40 years ago for $6,000. Cybil is either going to sell the car for
$8,000 or have it restored and sell it for $22,000. The restoration will cost $6,000. Cybil would be better off spending A. $10,000 to have the vehicle restored. B. $8,000 to have the vehicle restored. C. $2,000 to have the vehicle restored. D. $6,000 to have the vehicle restored. 19. Hairr Corporation bases its predetermined overhead rate on variable manufacturing overhead cost of $9.50 per machine-hour and fixed manufacturing overhead cost of $947,672 per period. If the denominator level of activity is 8,900 machine-hours, what would the predetermined overhead rate be? A. $950.00 B. $115.98 C. $9.50 D. $106.48 20. Diseth Corporation applies manufacturing overhead to products on the basis of standard machinehours. The company bases its predetermined overhead rate on 5,300 machine-hours. The company’s total budgeted fixed manufacturing overhead is $12,720. In the most recent month, the total actual fixed manufacturing overhead was $12,370. The company actually worked 5,350 machine-hours during the month. The standard hours allowed for the actual output of the month totaled 5,540 machine-hours. What was the overall fixed manufacturing overhead volume variance for the month? A. $576 Favorable B. $120 Unfavorable C. $350 Favorable D. $120 Favorable End of exam
The following transactions were completed by Winklevoss Inc
The following transactions were completed by Winklevoss Inc, whose fiscal year is the calendar year; Year 1 July 1. Issued $74,000,000 of 20-year, 11% callable bonds dated July 1, Year 1, at a market (effective) rate of 13%, receiving cash of $63,532,267. Interest is payable semiannually on Dec 31 and June 30. Oct 1. Barrowed $200,000 by issuing a six-year, 6% installment note to Nicks Bank. The note requires annual payments of $40,673 with the first payment occurring on Sept 30, Year 2. Dec 31. Accrued $3,000 of interest on the installment note. The interest is payable on the date of the next installment note payment. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannually interest payment. Year 2 June 30. Paid the semiannual interest on the bonds. The bond discount amortization of $261.693 is combined with the semiannual interest payment. Sept 30. Paid the annual payment on the note, which consisted of interest of $12,000 and principal of $28,673 Dec 31. Accrued $2,570 of interest on the installment note. The interest is payable on the date of the nest installment note payment. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannual interest payment. Year 3 June 30. Recorded the redemption of the bond, which were called at 98. The balance in the bond discount account is $9,420,961 after payment of interest and amortization of discount have been recorded. Record the redemption only. Sept 30. Paid the second annually payment on the note, which consisted of interest of $10,280 and principal of $30,393. 1. Journalize the entries to record the foregoing transactions. Round all amounts to the nearest dollar. 2. Indicate the amount of the interest expense in (a) Year 1 and (b) Year 2. 3. Determine the carrying amount of the bonds as of Dec 31, Year 2.
The long-term goals addresses educate employees
The long-term goals addresses educate employees and customers. Some ideas brought up were loyalty, customer service, and communication. What would education for customers look like? The movement to transformational relationships rather than transactional is due to the need for the organization to have a sustained business relationship. How does this relate to a 21st century Learning Organization?
Managerial Finance Assignment
Lemon Auto Wholesalers had sales of $880,000 last year, and cost of goods sold represented 77 percent of sales. Selling and administrative expenses were 12 percent of sales. Depreciation expense was $17,000 and interest expense for the year was $8,000. The firm’s tax rate is 30 percent. a. Compute earnings after taxes. b-1. Assume the firm hires Ms. Carr, an efficiency expert, as a consultant. She suggests that by increasing selling and administrative expenses to 14 percent of sales, sales can be increased to $930,300. The extra sales effort will also reduce cost of goods sold to 73 percent of sales. (There will be a larger markup in prices as a result of more aggressive selling.) Depreciation expense will remain at $17,000. However, more automobiles will have to be carried in inventory to satisfy customers, and interest expense will go up to $15,600. The firm’s tax rate will remain at 30 percent. Compute revised earnings after taxes based on Ms. Carr’s suggestions for Lemon Auto Wholesalers. (Round taxes and earnings after taxes to 1 decimal place.) b-2. Will her ideas increase or decrease profitability? Increase profitability Decrease profitability
C" level executive that has been recruited
Case II: You are a “C” level executive that has been recruited by a head hunter in the height of your tenure with the organization. You have nailed all of the developmental milestones, increased productivity, innovation and profitability, all very impressive accomplishments. The Board is pleased with your leadership. You have been heavily recruited, and a new opportunity with a competing organization will provide you more personal wealth and professional freedom. You have three more years on your current contract. What will be the best decision for you, your family and career? As a transactional-transformation leader, what are your choices? What will you do? how would explain your decision to the Board?
Strategy Implementation for Southwest Airlines
Describe the organisational design of Southwest Airlines as well as their most important control systems strategy-wise, biggest human resources issues, any relevant factors that come about from their cultural environment and the impact they’ve had on carrying out the strategy of the Airline. Assess the fit, or lack thereof, between the mission and strategy of Southwest Airlines, looking at organizational components that are the most vital to carrying out the strategy. Do they complement or detract? Why? Your answer should take the form of an official business report for the Board.
Listed below are the transactions of Yasunari Kawabata
Question 1 Listed below are the transactions of Yasunari Kawabata, D.D.S., for the month of September. Sept. 1 Kawabata begins practice as a dentist and invests $20,000 cash. 2 Purchases dental equipment on account from Green Jacket Co. for $17,280. 4 Pays rent for office space, $680 for the month. 4 Employs a receptionist, Michael Bradley. 5 Purchases dental supplies for cash, $942. 8 Receives cash of $1,690 from patients for services performed. 10 Pays miscellaneous office expenses, $430. 14 Bills patients $5,820 for services performed. 18 Pays Green Jacket Co. on account, $3,600. 19 Withdraws $3,000 cash from the business for personal use. 20 Receives $980 from patients on account. 25 Bills patients $2,110 for services performed. 30 Pays the following expenses in cash: Salaries and wages $1,800; miscellaneous office expenses $85. (Record each separately.) 30 Dental supplies used during September, $330. Record depreciation using a 5-year life on the equipment, the straight-line method, and no salvage value.
Arts and Crafts, Inc.
Arts and Crafts, Inc. will pay a dividend of $2 per share in 1 year. It sells at $40 a share, and firms in the same industry provide an expected rate of return of 13%. What must be the expected growth rate of the company’s dividends? (Do not round intermediate calculations. Enter your answer as a whole percent.) No-Growth Industries pays out all of its earnings as dividends. It will pay its next $2 per share dividend in a year. The discount rate is 10%. a. What is the price-earnings ratio of the company? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What would the P/E ratio be if the discount rate were 4%?(Round your answer to 2 decimal places.)
Analyze an investor earnings call: Anthony's Orchards
Earnings calls are designed to provide disclosure and financial results for a certain reporting period. In addition, earnings calls provide transparency and can help with forecasting and planning. Listen to the investor call on the Anthony’s Orchards website. Write a 1- to 2-page paper analyzing the investor call. State how the business plans to adjust and indicate whether you agree with the business decision. If not, how would you adjust the forecast in the next quarter based on the earnings call (i.e., second quarter numbers would go up instead of third; costs will go up in December, etc.)? Based upon the information, is it important to forecast? How is a forecast different than a budget? http://mym.cdn.laureate-media.com/2dett4d/Walden/ACCT/6130/mm/anthony_orchard_website/index.html