Question & Answer

What is hardness, and how is it generally tested?

Under which of the following circumstances is there likely to be a net gain from trade diversion (refer to Figure 24.14): (a) a small difference between the EU price and the Russian pre-tariff price, and a large difference between the EU price and the Russian price with the tariff, or vice versa; (b) Elastic or inelastic Polish demand and supply curves; (c) The Polish demand and supply curves close together or far apart?

C. Reither Co. reports the following information for 2014: sales revenue $700,000; cost of goods sold $500,000; operating expenses $80,000; and an unrealized holding loss on available-for-sale securities for 2014 of $60,000. It declared and paid a cash dividend of $10,000 in 2014. C. Reither Co. has January 1, 2014, balances in common stock $350,000; accumulated other comprehensive income $80,000; and retained earnings $90,000. It issued no stock during 2014. Instructions Prepare a statement of stockholders’ equity.

Simpson Corp. is an entertainment firm that derives approximately 30% of its income from the Casino Knights Division, which manages gambling facilities. As auditor for Simpson Corp., you have recently overheard the following discussion between the controller and financial vice president. Vice President: If we sell the Casino Knights Division, it seems ridiculous to segregate the results of the sale in the income statement. Separate categories tend to be absurd and confusing to the stockholders. I believe that we should simply report the gain on the sale as other income or expense without detail. Controller: Professional pronouncements would require that we report this information separately in the income statement. If a sale of this type is considered unusual and infrequent, it must be reported as an extraordinary item. Vice President: What about the walkout we had last month when employees were upset about their commission income? Would this situation not also be an extraordinary item? Controller: I am not sure whether this item would be reported as extraordinary or not. Vice President: Oh well, it doesn’t make any difference because the net effect of all these items is immaterial, so no disclosure is necessary. Instructions (a) On the basis of the foregoing discussion, answer the following questions. Who is correct about handling the sale? What would be the correct income statement presentation for the sale of the Casino Knights Division? (b) How should the walkout by the employees be reported? (c) What do you think about the vice president’s observation on materiality? (d) What are the earnings per share implications of these topics?

(Threshold Concept 4) 1. If there is a shortage of certain skilled workers in the economy, how will market forces lead to an elimination of the skills shortage? (Threshold Concept 4) 2. If consumers want more of a product, it is always desirable that market forces result in more being produced?

1. If 4x exchange for 3m what are the terms of trade? 2. If the terms of trade are 3, how many units of the imported good could I buy for the money earned by the sale of 1 unit of the exported good? What is the exchange ratio?

The specified dimension = 225.00 mm for a certain injection molded part made of ABS. Compute the corresponding dimension to which the mold cavity should be machined, using the value of shrinkage given in Table 13.1

Explain why some public firms decided to go private in response to the passage of the Sarbanes-Oxley (SOX) Act. (LO6)

The balance sheet data of Brown Company at the end of 2014 and 2013 follow. 2014 2013 Cash $ 30,000 $ 35,000 Accounts receivable (net) 55,000 45,000 Inventory 65,000 45,000 Prepaid expenses 15,000 25,000 Equipment 90,000 75,000 Accumulated depreciation—equipment (18,000) (8,000) Land 70,000 40,000 $307,000 $257,000 Accounts payable $ 65,000 $ 52,000 Accrued expenses 15,000 18,000 Notes payable—bank, long-term 202 23,000 Bonds payable 30,000 202 Common stock, $10 par 189,000 159,000 Retained earnings 8,000 5,000 $307,000 $257,000 Land was acquired for $30,000 in exchange for common stock, par $30,000, during the year; all equipment purchased was for cash. Equipment costing $10,000 was sold for $3,000; book value of the equipment was$6,000. Cash dividends of $10,000 were declared and paid during the year. Instructions Compute net cash provided (used) by: (a) Operating activities. (b) Investing activities. (c) Financing activities.

The major classifications of activities reported in the statement of cash flows are operating, investing, and financing. Classify each of the transactions listed below as: 1. Operating activity—add to net income. 2. Operating activity—deduct from net income. 3. Investing activity. 4. Financing activity. 5. Reported as significant noncash activity. The transactions are as follows. (a) Issuance of common stock. (h) Payment of cash dividends. (b) Purchase of land and building. (i) Exchange of furniture for office equipment. (c) Redemption of bonds. (j) Purchase of treasury stock. (d) Sale of equipment. (k) Loss on sale of equipment. (e) Depreciation of machinery. (l) Increase in accounts receivable during the year. (f) Amortization of patent. (m) Decrease in accounts payable during the year. (g) Issuance of bonds for plant assets.

What is a composite material?

The Samsons are trying to determine whether they can claim their 22-year-old adopted son, Jason, as a dependent.Jason is currently a full-time student at an out-of-state university.Jason lived in his parents’ home for three months of the year, and he was away at school for the rest of the year.He received $9,500 in scholarships this year for his outstanding academic performance and earned $4,800of income working a part-time job during the year. The Samsons paid a total of $5,000to support Jason while he was away at college.Jason used the scholarship, the earnings from the part-time job, and the money from the Samsons as his only sources of support. a. Can the Samsons claim Jason as their dependent?

Do tax-exempt organizations pay tax on dividends received from C corporations? Do tax-exempt organizations pay tax on business income earned? Explain.

Lexington Corporation’s weekly payroll of $24,000 included FICA taxes withheld of $1,836, federal taxes withheld of $2,990, state taxes withheld of $920, and insurance premiums withheld of $250. Prepare the journal entry to record Lexington’s payroll.

Joe operates a business that locates and purchases specialized assets for clients, among other activities. Joe uses the accrual method of accounting, but he does not keep any significant inventories of the specialized assets that he sells. Joe reported the following financial information for his business activities during this year. Determine the effect of each of the following transactions on the taxable business income.  a) Joe has signed a contract to sell gadgets to the city. The contract provides that sales of gadgets are dependent upon a test sample of gadgets operating successfully. In December of this year, Joe delivers $12,000 worth of gadgets to the city that will be tested in March of next year. Joe purchased the gadgets especially for this contract and paid $8,500. b) Joe paid $180 in July of this year to entertain a visiting out-of-town client. The client didn’t discuss business with Joe during this visit, but Joe wants to maintain good relations to encourage additional business next year. c) On November 1 of this year, Joe paid $600 for premiums providing for $40,000 of “key employee” insurance on the life of Joe’s accountant over the next 12 months. d) At the end of this year, Joe’s business reports $9,000 of accounts receivable. Based upon experience, Joe believes that at least $2,000 of his new receivables will be uncollectible.  e) In December of this year, Joe rented equipment to complete a large job. Joe paid $3,000 in December because the rental agency required a minimum rental of three months ($1,000 per month). Joe completed the job before year-end, but he returned the equipment at the end of the lease.  f) Joe hired a new sales representative as an employee and sent them to Dallas for a week to contact prospective out-of-state clients. Joe ended up reimbursing this employee $300 for airfare, $350 for lodging, and $250 for meals (the employee provided adequate documentation to substantiate the business purpose for the meals). Joe requires the employee to account for all expenditures to be reimbursed. g) Joe uses his BMW (a personal auto) to travel to and from his residence to his factory. However, he switches to a business vehicle if he needs to travel after he reaches the factory. In September of this year, the business vehicle broke down and he was forced to use the BMW both to travel to and from the factory and to visit work sites. He drove 120 miles visiting work sites and 46 miles driving back and forth between the factory and his home. Joe uses the standard mileage rate to determine his auto-related business expenses. h) Joe paid a visit to his parents in Dallas over the Christmas holidays this year. While he was in the city, Joe spent $50 to attend a half-day business symposium. Joe paid $200 for airfare, $50 for meals provided during the symposium, and $20 on cab fare to the symposium.

} In 2024, Nadia is single and has $100,000 of regular taxable income.  She itemizes her deductions as follows: real property taxes of $1,500, state income taxes of $2,000, and mortgage interest expense of $10,000 (acquisition debt of $200,000).  In addition, she receives tax-exempt interest of $1,000 from a municipal bond (issued in 2006) that was used to fund a new business building for a (formerly) out-of-state employer. Finally, she received a state tax refund of $300 from the prior year.   a. What is Nadia’s AMTI this year if she deducted $15,000 of itemized deductions last year (including a total of $4,000 of real property taxes and state income taxes) and did not owe any AMT last year? Complete Form 6251 (through line 4) for Nadia.

A spool of wire has a starting diameter of 2.5 mm. It is drawn through a die with an opening that is to 2.1 mm. The entrance angel of the die is 18° degrees. Coefficient of friction at the work-die interface is 0.08. The work metal has a strength coefficient of 450 MPa and a strain hardening coefficient of 0.26. The drawing is performed at room temperature. Determine (a) area reduction, (b) draw stress, and (c) draw force required for the operation.

Name some products that represent microsystem technology.

Wilco Corporation has the following account balances at December 31, 2014. Common stock, $5 par value $ 510,000 Treasury stock 90,000 Retained earnings 2,340,000 Paid-in capital in excess of par—common stock 1,320,000 Prepare Wilco’s December 31, 2014, stockholders’ equity section.

Within the current liabilities section, how do you believe the accounts should be listed? Defend your position.

This comment appeared in the annual report of MacCloud Inc.: “The Company could pay cash or property dividends on the Class A common stock without paying cash or property dividends on the Class B common stock. But if the Company pays any cash or property dividends on the Class B common stock, it would be required to pay at least the same dividend on the Class A common stock.” How is a property dividend accounted for in the financial records?

What are some of the principal applications of cemented carbides, such as WC-Co?

The orthogonal cutting operation described in previous Problem 21.7 involves a work material whose shear strength is 40,000 lb/in2 . Based on your answers to the previous problem, compute (a) the shear force, (b) cutting force, (c) thrust force, and (d) friction force.

Name some of the abrasive operations available to achieve very good surface finishes

A shaft made of aluminum is 40.0 mm in diameter at room temperature (21°C). Its coefficient of thermal expansion = 24.8 x 10-6 mm/mm per °C. If it must be reduced in size by 0.20 mm in order to be expansion fitted into a hole, determine the temperature to which the shaft must be cooled.