Question & Answer

Why is it necessary to develop a definitional framework for the basic elements of accounting?

1.       : If talkative men are viewed as powerful and competent, why do you think talkative women are seen as less capable and pushy? Do you think this perception would be different in an organization with a large percentage of female managers at top levels?

Explain how estimation of service lives can result in unrealistically high carrying values for fixed assets.

Solve Problem 24.26 only using maximum production rate as the objective rather than minimum piece cost. Use of a spreadsheet calculator is recommended

Neither depreciation on replacement cost nor depreciation adjusted for changes in the purchasing power of the dollar has been recognized as generally accepted accounting principles for inclusion in the primary financial statements. Briefly present the accounting treatment that might be used to assist in the maintenance of the ability of a company to replace its productive capacity.

What is the distinction between plastic sheet and film?

Juanita paid $50,000 of interest on a mortgage on her home (loan of $1,000,000 at 5% interest rate to buy the residence in 2018; $1,200,000 original purchase price and value at purchase) and $6,500 of interest on a $100,000 home-equity loan on her home (loan proceeds were used to buy furniture). Juanita’s AGI is $600,000. How much interest expense can Juanita deduct as an itemized deduction?

Explain how the downgrading of bonds for a particular corporation affects the prices of those bonds, the return to investors who currently hold these bonds, and the potential return to other investors who may invest in the bonds in the near future. (LO2)

Why must an S corporation report separately stated items to its shareholders? How is the character of a separately stated item determined?  How does the S corporation report this information to each shareholder?

1.              What other strategies might Amara adopt to work with the oil company men as an active member of the team? What are the pros and cons of each strategy?

Assume Rita’s consulting business generated $15,000 in gross income.

A test specimen in a tensile test has a gage length of 2.0 in and an area = 0.5 in2 . During the test the specimen yields under a load of 32,000 lb. The corresponding gage length = 2.0083 in. This is the 0.2 percent yield point. The maximum load of 60,000 lb is reached at a gage length = 2.60 in. Determine (a) yield strength, (b) modulus of elasticity, and (c) tensile strength. (d) If fracture occurs at a gage length of 2.92 in, determine the percent elongation. (e) If the specimen necked to an area = 0.25 in2 , determine the percent reduction in area.

Explain the difference between weak-form, semistrongform, and strong-form efficiency. Which of these forms of efficiency is most difficult to test? Which is most likely to be refuted? Explain how to test weakform efficiency in the stock market. (LO6)

In an orthogonal cutting operation, the rake angle = -5°, chip thickness before the cut = 0.2 mm and width of cut = 4.0 mm. The chip ratio = 0.4. Determine (a) the chip thickness after the cut, (b) shear angle, (c) friction angle, (d) coefficient of friction, and (e) shear strain.

The U.S. government intervened to resolve problems in the mortgage markets during the credit crisis. Summarize the advantages and disadvantages of the government intervention during the credit crisis. Should the government intervene when mortgage market conditions are very weak? (LO5)

Explain why participants in the stock market monitor the VIX. What does a decline in VIX imply about a change in expected volatility by market participants? (LO4)

Penny, a full-time biochemist, loves stock car racing. To feed her passion, she bought a used dirt-track car and has started entering some local dirt-track races. The prize money is pretty small ($1,000 for the winner), but she really is not in it for the money. This, Penny reported the following income and expenses from her nights at the track:

Why is the orthogonal cutting model useful in the analysis of metal machining?

In very general terms, how is the alternative minimum tax system different from the regular income tax system?  How is it similar?

Determine the bending force required in Problem 20.11 if the bend is to be performed in a V-die with a die opening width dimension = 1.25 in. The material has a tensile strength = 70,000 lb/in2 .

Answer the following multiple-choice questions. 1. GAAP stands for: (a) governmental auditing and accounting practices. (b) generally accepted attest principles. (c) government audit and attest policies. (d) generally accepted accounting principles. 2. Accounting standard-setters use the following process in establishing accounting standards: (a) Research, exposure draft, discussion paper, standard. (b) Discussion paper, research, exposure draft, standard. (c) Research, preliminary views, discussion paper, standard. (d) Research, discussion paper, exposure draft, standard. 3. GAAP is comprised of: (a) FASB standards, interpretations, and concepts statements. (b) FASB financial standards. (c) FASB standards, interpretations, EITF consensuses, and accounting rules issued by FASB predecessor organizations. (d) any accounting guidance included in the FASB Codification. 4. The authoritative status of the conceptual framework is as follows. (a) It is used when there is no standard or interpretation related to the reporting issues under consideration. (b) It is not as authoritative as a standard but takes precedence over any interpretation related to the reporting issue. (c) It takes precedence over all other authoritative literature. (d) It has no authoritative status. 5. The objective of financial reporting places most emphasis on: (a) reporting to capital providers. (b) reporting on stewardship. (c) providing specific guidance related to specific needs. (d) providing information to individuals who are experts in the field. 6. General-purpose financial statements are prepared primarily for: (a) internal users. (b) external users. (c) auditors. (d) government regulators. 7. Economic consequences of accounting standard-setting means: (a) standard-setters must give first priority to ensuring that companies do not suffer any adverse effect as a result of a new standard. (b) standard-setters must ensure that no new costs are incurred when a new standard is issued. (c) the objective of financial reporting should be politically motivated to ensure acceptance by the general public. (d) accounting standards can have detrimental impacts on the wealth levels of the providers of financial information. 8. The expectations gap is: (a) what financial information management provides and what users want. (b) what the public thinks accountants should do and what accountants think they can do. (c) what the governmental agencies want from standard-setting and what the standard-setters provide. (d) what the users of financial statements want from the government and what is provided.

Rank the following three single taxpayers in order of the magnitude of taxable income (from lowest to highest) and explain your results. Ahmed           Baker                    Chin Gross Income                 $ 80,000               $ 80,000               $ 80,000Deductions For AGI            8,000                    4,000                           0Itemized Deductions                   0                    4,000                    8,000

1.    : Why do some organizations seem to have a new CEO every two or three years, whereas others have top leaders who stay with the company for many years (e.g., Warren Buffett’s 50 years at Berkshire Hathaway)? What factors about the manager or about the company might account for this difference?

What are the two joint types most commonly used in brazing?

4 A disk-shaped part is to be cast out of aluminum. The diameter of the disk = 500 mm and its thickness = 20 mm. If the mold constant = 2.0 sec/mm2 in Chvorinov's rule, how long will it take the casting to solidify?