Question & Answer

1.      : Review the section on goal conflict in the chapter. Do you think that building a coalition and working out stakeholder differences in goal preferences is an important part of a manager’s job? Why or why not?

Lauren is 17 years old.  She reports earned income of $3,000 and unearned income of $6,200.  Is it likely that she is subject to the kiddie tax?  Explain.

Will underapplied and overapplied overhead arise under both actual and normal costing? Explain your answer.

A cup is to be drawn in a deep drawing operation. The height of the cup is 75 mm and its inside diameter = 100 mm. The sheet-metal thickness = 2 mm. If the blank diameter = 225 mm, determine (a) drawing ratio, (b) reduction, and (c) thickness-to-diameter ratio. (d) Does the operation seem feasible?

Is deindustrialisation necessarily undesirable?

What is resistance-projection welding?

Under what circumstances can partners with passive losses from partnerships deduct their passive losses?

Does it matter if a country has a large national debt as a proportion of its national income?

Specific identification is sometimes said to be the ideal method of assigning cost to inventory and to cost of goods sold. Briefly indicate the arguments for and against this method of inventory valuation.

List two common situations that will cause a partner’s inside and outside basis to differ.

During a tensile test, a metal has a true strain = 0.10 at a true stress = 37,000 lb/in2 . Later, at a true stress = 55,000 lb/in2 , true strain = 0.25. Determine the strength coefficient and strain-hardening exponent in the flow curve equation.

Explain how the Galleon Fund case led to stronger enforcement against insider trading. (LO4)

During the coronavirus pandemic, between 2020 and 2022, the Fed implemented two different monetary policies. Explain the circumstances that led the Fed to change the monetary policy. (LO2; LO3)

Briefly describe some of the similarities and differences between GAAP and IFRS with respect to the accounting for stockholders’ equity.

How are the tax consequences of a cash distribution different from those of a noncash property distribution to both the S corporation and the shareholders?

Deluxe Ezra Company purchases equipment on January 1, Year 1, at a cost of $469,000. The asset is expected to have a service life of 12 years and a salvage value of $40,000. Instructions (a) Compute the amount of depreciation for each of Years 1 through 3 using the straight-line depreciation method. (b) Compute the amount of depreciation for each of Years 1 through 3 using the sum-of-the-years’- digits method. (c) Compute the amount of depreciation for each of Years 1 through 3 using the double-declining-balance method. (In performing your calculations, round constant percentage to the nearest one-hundredthof a point and round answers to the nearest dollar.)

In 2024, Sheryl is claimed as a dependent on her parents’ tax return.  Her parents report taxable income of $600,000 (married filing jointly). Sheryl did not provide more than half her own support.  What is Sheryl’s tax liability for the year in each of the following alternative circumstances?

Why is it important to be able to determine whether a particular book-tax difference is permanent or temporary?

The Sarbanes-Oxley Act was enacted to combat fraud andcurb poor reporting practices. What are some key provisionsof this legislation?

was founded in 1969 as Trus Joist International. The firm, a manufacturer of specialty building products, has its headquarters in Boise, Idaho. The company, through its partnership in the Trus Joist MacMillan joint venture, develops and manufactures engineered lumber. This product is a high-quality substitute for structural lumber and uses lower-grade wood and materials formerly considered waste. The company also is majority owner of the Outlook Window Partnership, which is a consortium of three wood and vinyl window manufacturers. Following is T J International’s adapted income statement and information concerning inventories from its annual report.     Instructions (a) How much would income before taxes have been if FIFO costing had been used to value all inventories? (b) If the income tax rate is 46.6%, what would income tax have been if FIFO costing had been used to value all inventories? In your opinion, is this difference in net income between the two methods material? Explain. (c) Does the use of a different costing system for different types of inventory mean that there is a different physical flow of goods among the different types of inventory? Explain.

How do open-end mutual funds differ from closed-end funds? (LO1, LO5)

Whitney received $75,000 of taxable income in 2024.  All of the income was salary from her employer.  What is her income tax liability in each of the following alternative situations?

Why does the USA not specialise as much as General Motors or Texaco? Why does the UK not specialise as much as Tesco? Is the answer to these questions similar to the answer to the questions, ‘Why does the USA not specialise as much as Luxembourg?’, and ‘Why does Tesco or Unilever not specialise as much as the local butcher?’

What types of information in addition to cost accounting are needed for management decisions?

Chuck, a single taxpayer, earns $75,000 in taxable income and $10,000 in interest from an investment in City of Heflin bonds.  Using the U.S. tax rate schedule (see Appendix C), how much federal tax will he owe?  What is his average tax rate?  What is his effective tax rate?  What is his current marginal tax rate?