Question & Answer

On December 31, 2014, Conchita Martinez Company signed a $1,000,000 note to Sauk City Bank. The market interest rate at that time was 12%. The stated interest rate on the note was 10%, payable annually. The note matures in 5 years. Unfortunately, because of lower sales, Conchita Martinez’s financial situation worsened. On December 31, 2016, Sauk City Bank determined that it was probable that the company would pay back only $600,000 of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $1,000,000 loan. Instructions (a) Determine the amount of cash Conchita Martinez received from the loan on December 31, 2014. (b) Prepare a note amortization schedule for Sauk City Bank up to December 31, 2016. (c) Determine the loss on impairment that Sauk City Bank should recognize on December 31, 2016.

Explain how information from a scatter plot helps in categorising a cost as fixed, variable, or mixed.

What are the general physical properties of ceramic materials?

What is strategic decision making? What role does it play in the balanced scorecard?

Why might the role of the accountant be referred to as one of a ‘detective’ in relation to variance analysis?

You are about to start a coffee shop business. What do you understand by ‘cost behaviour’? Explain how your accountants could help you in building an understanding of cost behaviour. Identify the likely key costs and classify each as fixed or variable.

Monat Construction Company, Inc., entered into a firm fixed-price contract with Hyatt Clinic on July 1, 2014, to construct a four-story office building. At that time, Monat estimated that it would take between 2 and 3 years to complete the project. The total contract price for construction of the building is $4,400,000. Monat appropriately accounts for this contract under the completedcontract method in its financial statements and for income tax reporting. The building was deemed substantially completed on December 31, 2016. Estimated percentage of completion, accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to the Hyatt Clinic under the contract are shown below. At At At December December December 31, 2014 31, 2015 31, 2016 Percentage of completion 30% 70% 100% Contract costs incurred $1,140,000 $3,290,000 $4,800,000 Estimated costs to complete the contract $2,660,000 $1,410,000 –0– Billings to Hyatt Clinic $1,400,000 $2,500,000 $4,300,000 Instructions (a) Prepare schedules to compute the amount to be shown as “Cost in excess of billings” or “Billings in excess of costs” at December 31, 2014, 2015, and 2016. (Ignore income taxes.) Show supporting computations in good form. (b) Prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2014, 2015, and 2016. (Ignore income taxes.) Show supporting computations in good form.

What are the arguments for reward systems at the executive level to      contain a longer-term component?             (LO3)

In general, how are unincorporated business entities classified for tax purposes?

Balanced scorecard perspectives, performance objectives, and measures Perspectives, performance objectives and potential performance measures for the balanced scorecard at Holiday Resorts are as follows: Perspectives (i)         Financial (ii)        Customer (iii)       Internal business (iv)       Learning and growth   Performance objectives A.      Reduce housekeeping costs B.      Improve the quality of and results from advertising campaigns C.      Decrease vacancy rate during the off-season D.      Increase number of return customers E.      Increase overall profits F.      Increase the use of Internet-based reservations G.     Retain high-quality employees H.      Increase the number of activities available to customers I.       Improve the quality of stay for holiday makers J.       Provide employee training in quality customer service K.     Reduce error rate in reservations   Potential performance measures 1.       Operating margin 2.       Customer complaint rate 3.       Survey customers at check-in about how they first heard about the resorts 4.       Housekeeping cost per room 5.       Number of employee hours spent in training 6.       Error rate in reservation process 7.       Percentage of reservations made using the website 8.       Customer surveys about satisfaction and quality 9.       Employee turnover rates 10.     Number of activities per resort that are available to customers 11.     Percentage and number of return customers 12.     Number of hours of employee training offered 13.     Vacancy rates 14.     Customer focus groups inquiring about quality and potential success of advertising 15.     Number of suggestions that improve quality of service   Required (a)     For each perspective (i–iv), identify at least one appropriate performance objective (A–K). (b)     For each performance objective (A–K), identify at least one appropriate performance measure (1–15). (c)     Explain the links between the measures.

In 2024, Juanita is married and files a joint tax return with her husband.  What is her tentative minimum tax in each of the following alternative circumstances?

Under what circumstances can a taxpayer deduct medical expenses paid for a member of their family? Does it matter if the family member reports significant amounts of gross income and cannot be claimed as a dependent?

Henrich is a single taxpayer. In 2024, his taxable income is $530,000.  What are his income tax and net investment income tax liability in each of the following alternative scenarios?

Suppose you asked your favorite AI query tool “Is multijurisdictional tax-motivated income shifting an example of the conversion strategy?” and the AI tool responded as follows: Is the AI response correct? Explain.

1.              : Go ahead and close the deal, but come clean later. Explain that the controller had been on an extended leave of absence and because you had been on the job for only a few days, you had not had time to analyze the numbers yourself.

Reward systems for different levels of employees Freshwater is an entity that processes and distributes bottled water throughout Australia and New Zealand. You have been employed as a remuneration consultant to develop a new reward system for the entity.   Required Explain how you would develop an incentive plan for the CEO, the divisional manager of the process division, and the sales manager who arranges customer sales. How are the reward systems similar? How are the reward systems different? (LO2 and 4)

Describe the growing-equity mortgage. How does it differ from a graduated-payment mortgage? (LO2)

Your aunt recently received the annual report for a company in which she has invested. The report notes that the statements have been prepared in accordance with “generally accepted accounting principles.” She has also heard that certain terms have special meanings in accounting relative to everyday use. Shewould like you to explain the meaning of terms she has come across related to accounting. Instructions Go to http://www.fasb.org and access the FASB Concepts Statements and respond to the following items. (Provide paragraph citations.) When you have accessed the documents, you can use the search tool in your Internet browser. (a) How is “materiality” defined in the conceptual framework? (b) The concepts statements provide several examples in which specific quantitative materiality guidelines are provided to firms. Identity at least two of these examples. Do you think the materiality guidelines should be quantified? Why or why not? (c) The concepts statements discuss the concept of “articulation” between financial statement elements. Briefly summarize the meaning of this term and how it relates to an entity’s financial statements.

Using the facts in Problem 51, what is the minimum tax that Pedro should pay to make the tax structure vertically equitable based on the tax rate paid?  This would result in what type of tax rate structure?

Explain the difference between pretax financial income and taxable income.

1.      : Have the successes of sales associates such as Katherine or Damien created a situation in which customers’ loyalty to particular salespeople is stronger than their loyalty to the store? For example, if a successful associate leaves Morgan’s, might the customer leave also?

What are the criteria that should be satisfied to make an automated manufacturing system flexible?

A direct extrusion operation is performed on a cylindrical billet with an initial diameter of 2.0 in and an initial length of 4.0 in. The die angle = 60° and orifice diameter is 0.50 in. In the Johnson extrusion strain equation, a = 0.8 and b = 1.5. The operation is carried out hot and the hot metal yields at 13,000 lb/in2 and does not strain harden when hot. (a) What is the extrusion ratio? (b) Determine the ram position at the point when the metal has been compressed into the cone of the die and starts to extrude through the die opening. (c) What is the ram pressure corresponding to this position? (d) Also determine the length of the final part if the ram stops its forward movement at the start of the die cone.

Why do banks invest in securities even though loans typically generate a higher return? Explain how a bank decides the appropriate percentage of funds that should be allocated to each type of asset. (LO3)

What are some of the applications of PVD?