Question & Answer

Name the two basic categories of casting processes.

Explain how ADRs enable U.S. investors to become part owners of foreign companies. (LO7)

Amy Dyken, controller at Fitzgerald Pharmaceutical Industries, a public company, is currently preparing the calculation for basic and diluted earnings per share and the related disclosure for Fitzgerald’s financial statements. Below is selected financial information for the fiscal year ended June 30, 2014.   The following transactions have also occurred at Fitzgerald. 1. Options were granted on July 1, 2013, to purchase 200,000 shares at $15 per share. Although no options were exercised during fiscal year 2014, the average price per common share during fiscal year 2014 was $20 per share. 2. Each bond was issued at face value. The 8% convertible bonds will convert into common stock at 50 shares per $1,000 bond. The bonds are exercisable after 5 years and were issued in fiscal year 2013. 3. The preferred stock was issued in 2013. 4. There are no preferred dividends in arrears; however, preferred dividends were not declared in fiscal year 2014. 5. The 1,000,000 shares of common stock were outstanding for the entire 2014 fiscal year. 6. Net income for fiscal year 2014 was $1,500,000, and the average income tax rate is 40%. Instructions For the fiscal year ended June 30, 2014, calculate the following for Fitzgerald Pharmaceutical Industries. (a) Basic earnings per share. (b) Diluted earnings per share.

How is the present value of a non-interest-bearing note computed?

Explain how the value-at-risk (VaR) method can be used to determine whether a bank has adequate capital. (LO3)

Under what circumstances does a corporate shareholder receive tax deferral in a complete liquidation?

The flow curve for a certain metal has a strain-hardening exponent of 0.22 and strength coefficient of 54,000 lb/in2 . Determine (a) the flow stress at a true strain = 0.45 and (b) the true strain at a flow stress = 40,000 lb/in2 .

Two years ago, Kimberly became a 30 percent partner in the KST Partnership with a contribution of investment land with a $10,000 basis and $16,000 fair market value. On January 2 of this year, Kimberly has a $15,000 basis in her partnership interest, and none of her pre-contribution gain has been recognized. On January 2 Kimberly receives an operating distribution of a tract of land (not the contributed land) with a $12,000 basis and an $18,000 fair market value. a. What are the amount and character of Kimberly’s recognized gain or loss on the distribution? b. What is Kimberly’s remaining basis in KST after the distribution? c. What is KST’s basis in the land Kimberly contributed after Kimberly receives this distribution?

Explain how each type of financial institution serves as a financial intermediary. (LO3)

The trial balance of Wanda Landowska Company (shown on the next page) does not balance. Your review of the ledger reveals the following. (a) Each account had a normal balance. (b) The debit footings in Prepaid Insurance, Accounts Payable, and Property Tax Expense were each understated $100. (c) A transposition error was made in Accounts Receivable and Service Revenue; the correct balances for Accounts Receivable and Service Revenue are $2,750 and $6,690, respectively. (d) A debit posting to Advertising Expense of $300 was omitted. (e) A $1,500 cash drawing by the owner was debited to Owner’s Capital and credited to Cash.   Instructions Prepare a correct trial balance.

Cost behaviour; scatter plot Polar Bear Ski Wear is a shop that sells skiwear at a ski resort. Its cost accountant developed the following scatter plot for the cost of electricity for lights, heating, and cooling against retail sales revenue.                             Required (a)          In a business such as retail sales, what usually causes the cost of electricity to vary? (b)          In what time of year would most skiwear be sold at a ski resort? (c)           In the scatter plot, the cost of electricity appears to be related to volume of retail sales. If this shop specialised in selling swimwear, would the scatter plot look different? Explain what would change. (d)          Identify and explain another cost that is similar in nature to the cost of electricity. When you plot the cost against a cost driver, a relationship becomes apparent. However, the cost varies with something other than the cost driver. (Think of other situations where this type of relationship might occur.)

Included in Gonzalez Company’s December 31 trial balance is a note receivable of $12,000. The note is a 4-month, 10% note dated October 1. Prepare Gonzalez’s December 31 adjusting entry to record $300 of accrued interest, and the February 1 journal entry to record receipt of $12,400 from the borrower.

Coldwell, Inc. issued a $100,000, 4-year, 10% note at face value to Flint Hills Bank on January 1, 2014, and received $100,000 cash. The note requires annual interest payments each December 31. Prepare Coldwell’s journal entries to record (a) the issuance of the note and (b) the December 31 interest payment.

In porcelain enameling, what is frit?

How do you think the positions of these eight countries will change over the next decade?

Shea Savings negotiates a fixed-for-floating swap with a reputable firm in South America that has an exceptional credit rating. Shea is very confident that there will not be a default on inflow payments because of the very low credit risk of the South American firm. Do you agree? Explain. (LO3)

14   Sustainability threats and opportunities The World Coal Institute claims that coal provides over 26.5 per cent of global primary energy needs and generates over 41.5 per cent of the world’s electricity. Coal is one of the cheapest forms of fuel available on the planet. However, burning fuel produces carbon dioxide which contributes to excessive greenhouse gas emissions and global warming. Rather than change energy sources, Clean Coal Technologies (CCTs) have been promoted as a means of reducing emissions, reducing waste as well as increase the efficiency (or amount of energy) gained from coal.72   Required Referring to the information in this problem and drawing on comprehensive example 2, discuss some of the sustainability management threats and opportunities for the future of Australian coal producers. (LO1, 2, 3, 4 and 5)

Explain how the bankruptcy of Lehman Brothers (a large securities firm) reduced the liquidity of the commercial paper market. (LO1)

Explain how residual income is calculated, and define required rate of return in your own words.

There are 17 correct answers in the following multiple choice questions (some questions have multiple answers that are correct). To attain a perfect score on the quiz, all correct answers must be given. Each correct answer is worth 1 point. Each omitted answer or wrong answer reduces the score by 1 point, and each additional answer beyond the correct number of answers reduces the score by 1 point. Percentage scor the quiz is based on the total number of correct answers. 26.1 Which of the following processes use mechanical energy as the principal energy source (three correct answers): (a) electrochemical grinding, (b) laser beam machining, (c) conventional milling, (d) ultrasonic machining, (e) water jet cutting, and (f) wire EDM? 26.2 Ultrasonic machining can be used to machine both metallic and nonmetallic materials: (a) true or (b) false? 26.3 Applications of electron beam machining are limited to metallic work materials due to the need for the work to be electrically conductive: (a) true or (b) false? 26.4 Which one of the following is closest to the temperatures used in plasma arc cutting: (a) 2750°C (5000°F), (b) 5500°C (10,000°F), (c) 8300°C (15,000°F), (d) 11,000°C (20,000°F), or (e) 16,500°C (30,000°F) 26.5 Chemical milling is used in which of the following applications (two best answers): (a) drilling holes with high depth-to-diameter ratio, (b) making intricate patterns in thin sheet metal, (c) removing material to make shallow pockets in metal, (d) removing metal from aircraft wing panels, and (e) cutting of plastic sheets? 26.6 Etch factor is equal to which of the following in chemical machining (more than one): (a) anisotropy, (b) CIt, (c) d/u, and (d) u/d; where C = specific removal rate, d = depth of cut, I = current, t = time, and u = undercut? 26.7 Of the following processes, which one is noted for the highest material removal rates: (a) electric discharge machining, (b) electrochemical machining, (c) laser beam machining, (d) oxyfuel cutting, (e) plasma arc cutting, (f) ultrasonic machining, or (g) water jet cutting? 26.8 Which one of the following processes would be appropriate to drill a hole with a square cross section, 0.25 inch on a side and 1-inch deep in a steel workpiece: (a) abrasive jet machining, (b) chemical milling, (c) EDM, (d) laser beam machining, (e) oxyfuel cutting, (f) water jet cutting, or (g) wire EDM? 26.9 Which of the following processes would be appropriate for cutting a narrow slot, less than 0.015 inch wide, in a 3/8-in-thick sheet of fiber-reinforced plastic (two best answers): (a) abrasive jet machining, (b) chemical milling, (c) EDM, (d) laser beam machining, (e) oxyfuel cutting, (f) water jet cutting, and (g) wire EDM? 26.10 Which one of the following processes would be appropriate for cutting a hole of 0.003 inch diameter through a plate of aluminum that is 1/16 in thick: (a) abrasive jet machining, (b) chemical milling, (c) EDM, (d) laser beam machining, (e) oxyfuel cutting, (f) water jet cutting, and (g) wire EDM? 26.11 Which of the following processes could be used to cut a large piece of 1/2-inch plate steel into two sections (two best answers): (a) abrasive jet machining, (b) chemical milling, (c) EDM, (d) laser beam machining, (e) oxyfuel cutting, (f) water jet cutting, and (g) wire EDM?

Explain how the standard deduction is rationalized and why the standard deduction might be viewed as a floor limit on itemized deductions.

What are the two most common alloying metals used in solders?

Assume that there is a positive technological shock. How would this impact on the equilibrium level of employment and the economy’s potential output?  Illustrate using diagrams of both the labour and goods markets.

For the following application, identify one or more nontraditional machining processes that might be used, and present arguments to support your selection. Assume that either the part geometry or the work material (or both) preclude the use of conventional machining. The application is an engraved aluminum printing plate to be used in an offset printing press to make 275 by 350 mm (11 by 14 in) posters of Lincoln's Gettysburg address.

For the following application, identify one or more nontraditional machining processes that might be used, and present arguments to support your selection. Assume that either the part geometry or the work material (or both) preclude the use of conventional machining. The application is a through-hole in the shape of the letter L in a 12.5 mm (0.5 in) thick plate of glass. The size of the \"L\" is 25 by 15 mm (1.0 by 0.6 in) and the width of the hole is 3 mm (1/8 in).