Accounting question and answers for November 16, 2023
- Q What is a relevant cost? Provide a scenario illustrating analysis of relevant costs in a make or buy scenario.
- Q Omar is hired at $18.50 an hour and worked 47 hours during the workweek. His gross wages are
- Q 10)W, Inc. holds 100% of the common stock of C Co, an investment acquired for $680,000. Immediately following the combination,W net assets have a book value of $1,150,000 and a...
- Q A large Canadian retailer is analyzing both a leveraged and an unleveraged capital structure. The all equity capital option they are considering would consist of 20,000 shares of stock. The...
- Q Which of the following costs would be capitalized?A. An asset purchased for a specific R&D project if the asset's useful life extends beyond the current year.B. R&D purchased in a...
- Q 1. What is the GOPPAR of Hotel X for the year 2021?2. What is the flow-through for Hotel X for the period of 2020-2021?Revenue December 2020 | December 2021Rooms Occupied 6,560.00 |...
- Q A sportswear manufacturer is introducing a new line of sneakers. To introduce the new line, the company must pay out a fixed cost of $1.5 million for advertising and equipment,...
- Q One day a potential new client walks in off the street. He is a young, energetic guy who recently started a service business and is well known in the community;...
- Q Bramble's Snowshoes usually sells its snowshoes for $135 per unit and allows Bramble's to earn a 20% profit margin. It has recently come to Bramble's attention that the expected selling...
- Q A parent company can acquire bonds either directly. From the subsidiary or from a nonaffiliate that originally acquired the subsidiary's bonds. Does it matter from whom the bonds are acquired?
- Q This is a building company in Melbourne.The company is a family enterprise owned by a husband-wife team with backgrounds in real estate and construction. The company started operating in 2009...
- Q Assume that you will work for 40 years, and be retired for 25 years. The first retirement withdrawal will be at the end of year 41. Deposits will be made...
- Q The market rent of a property is $36,000 per annum. If the rental is expected to grow at 3% annually, what is the expected market rent for the property after...
- Q On January 1 Year 2 Grand Company Purchased as held for the collection Investment P1,000,000 face value of Zazu Company's 8% bond for 912,400. The bonds mature on January 1...
- Q Sunset Animal Clinic, Inc. has $120,000 of taxable income for this year and paid $20,000 federal income tax on its taxable income. It has charitable contribution of $20,000 to be...
- Q An investor buys 100 shares of Walmart at $45 per share on margin with an initial margin of 50% and a maintenance margin of 25% percent. what price will a margin...
- Q The “hole”(or “starting hand”) of a Texas hold'em game consists of drawing at random two cards of a standard deck of 52, (ordering irrele- vant).1a) How many distinct hands can...
- Q The Pfiza healthcare company has issued one- and two-year annual coupon bonds with par value of $100. Both have coupon rates of 10% per year. The yields to maturity of...
- Q TechWave Enterprises is analyzing two projects with the following net cash flows. The company's required rate of return on investments is 10%. (PV of $1, FV of $1, PVA of...
- Q EcoFriendly Manufacturing is considering two projects with the following net cash flows. The company's required rate of return on investments is 11%. (PV of $1, FV of $1, PVA of...
- Q PQR Ltd. needs to evaluate two projects requiring an initial investment of ?40,000 each and a life of 5 years. The firm's cost of capital is 9%, and it pays...
- Q XYZ Manufacturing is considering two projects with the following cash flows. The required return on investments is 12%.YearProject AlphaProject Beta0-$50,000-$60,0001$20,000$25,0002$25,000$30,0003$15,000$20,0004$10,000$15,000a. Calculate the payback period for each project. b. Compute the...
- Q A firm with a cost of capital of 9% is considering two mutually exclusive projects X and Y with the following details:YearProject XProject Y0(80,000)(90,000)115,00045,000225,00035,000335,00025,000450,00015,000570,00010,000
- Q Calculate the IRR and NPV for DEF Ltd. considering the following cash flows and a discount rate of 10%.YearProject Q0(150,000)140,000250,000360,000470,000580,000
- Q GHI Pharmaceuticals is deciding between two projects. The projected cash flows are given below. The company’s discount rate is 11%.YearProject MProject N0-$250,000-$300,0001$70,000$80,0002$80,000$90,0003$90,000$100,0004$100,000$110,000a. Calculate the IRR for each project. b. Determine...
- Q The following accounts were reported on Coin Incorporated’s 2019 balance sheet. Cash $2087, Marketable Securities $500, Accounts Receivable $2496, Current Liabilities $6769. Use the data to calculate Coin Incorporated’s quick ratio for 2019.
- Q In anatomy fraud investigation, were you surprised by the revelation of the "relationship" between the controller and the crying lady? What implications does this have? Are you surprised/mad that HR...
- Q A firm needs to raise $650 million for a project; external equity financing will be required. The firm faces flotation costs of 8.0% for equity and 2.0% for debt. If...
- Q You have been made an offer to work at the public college you attended six years ago. Even though you are happy at the CPA firm you are currently with,...
- Q Using what you’ve learned about the Organizational Structure Elements in SAP’s FI system, please read the mini case below and do 2 things:Using an Organizational Chart, graphically depict how you...
- Q Mr. Espiritu is a resident Filipino citizen. He purchased a parcel of land in Makati City in 1970 at a consideration of P1 Million. In 2021, the land , which...
- Q Sisiw Company is a non-VAT registered company which sells dry goods.The sales for the month are the following:100,000 to VAT-registered customers, 70% of which has been collected in cash.70,000 to...
- Q Summarize the trends in your company's ratio performance over the 3 most recent years. Be sure to address the following ratios included in Appendix C:Profitability ratios: ROA, ROE, return on...
- Q Mary borrowed $170,000 to buy a house. The loan had a 30-year term with monthly payments at 9.25% per annum interest. Now she wants to sell the house after 5...
- Q You are excited to begin as a tax professional in your community and have lots of potential clients. In setting up your office, you decide on an LLC structure; as...
- Q Melissa and Robb have twin 10-year-old girls who are in day care. Melissa works full time and Robb is a full-time student for 9 months. Melissa earned $150,000 and they...
- Q Benny is a partner in the BEN partnership. His outside basis is $275. He receives a distribution of $75 in cash:1) If the distribution is taxable to Benny indicate the...
- Q Coronado Inc acquired 122,000 common shares, which is 25% of the outstanding common shares, of Tahiti Ltd. on January 1, 2017 for $774,700. At the time of purchase, Tahiti Ltd....
- Q Division ABC has $750,000 invested in assets and earned $200,000 in income. Division XYZ has $800,000 invested in assets and earned $210,000 in income. The company's target rate is 10%.What...
- Q Your firm landed a great audit client, an up-and-coming tech company with inventions they think will change the world while making a lot of money for the owners. When they...
- Q You are the treasurer and a member of the board of directors of a nonprofit that is considering a merger with another exempt organization. You are on the way back...
- Q Describe the company, the nature of scandal and how it was impacted and what were the ultimate consequences? In your response specify the exact nature of the accounting issues and...
- Q Your friend is a CPA in public practice who is going through a rough patch. Three things happened in the last year that he needs your advice on:1. He had...
- Q To be effective issuing and investing in bonds, knowledge of their terminology, characteristics, and features is essential.For example:•A bond’s is generally $1,000 and represents the amount borrowed from the bond’s...
- Q Roro Bistro is a VAT-registered restaurant in Malaybalay City.An elderly woman entered the premise and ordered the following:Vegetable soup at 150Fried chicken at 120 Mango shake at 70Another customer, who is...
- Q Mr. A sold his family home for P5,000,000. He bought the land for P1,000,000 and introduced improvements therein for a total cost of P2,000,000. What is the amount of capital gains...
- Q On January 1, 2021, Michaels Inc. purchases a used property at a cost of $4,200,000. Of this amount, $375,000 represents the FMV of the land and $3,825,000 the value of...
- Q You are a gold mining company with substantial undeveloped.Reserves of gold and relatively little gold production. What of the combinations will make your gold reserves more valuable?
- Q Individuals who own homes may take a tax deduction for interest paid. Many individuals believe that this tax law discriminates against individuals who rent. Do you think this deduction is...
- Q Your portfolio consists of $58210 invested in Stock X and $49908 invested in Stock Y. Stock X has a beta of 0.83 and Stock Y has a beta of 1.05....
- Q Juan is a self-employed business owner. how does Juan report the owner's compensation for his sole proprietorship? Juan reports the owner's compensation as net profit on a Schedule C form...
- Q Identify any and all marketing strategies, promotions, and/or advertising that you saw relating to Chef Adan Medrano visiting Lubbock.Write a short description of how you, as a marketer, would have...
- Q Soon after finishing college, you land a great job and are one of two professionals performing an audit of a small, publicly held company. You are impressed that just you...
- Q Leno Hardware is owned and operated as a sole proprietorship by Larry Leno. The location is excellent, and he is approached by a buyer, Hard Bargains Inc., a national chain...
- Q Nike, Inc. is implementing cost management strategies to streamline operations and enhance profitability. The cost accountant identified opportunities for cost reduction in manufacturing, supply chain management, marketing, and administrative functions....
- Q JKL Foods is analyzing two potential investments. The projected cash flows for each project are listed below. The firm’s discount rate is 10%.YearProject 3Project 40-$60,000-$70,0001$15,000$20,0002$20,000$25,0003$25,000$30,0004$10,000$15,000a. Determine the payback period for...
- Q ABC Ltd. is considering two mutually exclusive projects. Both require an initial cash outlay of ?20,000 for machinery and have a life of 4 years. The company’s required rate of...
- Q JKL Ltd. has two potential projects, each requiring an initial outlay of ?50,000 and a life of 4 years. The required rate of return is 11%, and the tax rate...
- Q WXY Holdings is considering two mutually exclusive projects. Each project requires an initial investment of $1,000,000. The projected cash inflows are as follows:YearProject EProject F0-$1,000,000-$1,000,0001$250,000$350,0002$300,000$300,0003$350,000$250,0004$400,000$200,000a.Compute the payback period for both...
- Q IBM Corporation offers software solutions to businesses worldwide. The company's management conducted a contribution margin analysis to assess the profitability of its software products. The analysis includes estimates of variable...
- Q Rho Ltd issues loan notes of £120,000 on 1 January 2042. Redemption is to take place on equal terms, six years later. The company decides to put aside an equal amount...
- Q Zenith Tech Ltd is evaluating three machines to boost its production. The details for the machines are as follows. Assume all sales are cash-based. Corporate income-tax rate is 32%. Interest...
- Q Calculate the NPV of two projects and suggest which one should be accepted assuming a discount rate of 12%.Project AlphaProject BetaInitial InvestmentRs. 40,000Rs. 70,000Estimated Life4 Years4 YearsScrap ValueRs. 3,000Rs. 5,000Years1234Alpha10,00020,00012,0008,000Beta50,00020,00015,00010,000
- Q Tech Innovations Inc. is analyzing two new projects with the following net cash flows. The company's required rate of return on investments is 13%. (PV of $1, FV of $1,...
- Q Advanced Robotics is evaluating two projects with the following net cash flows. The company's required rate of return on investments is 7%. (PV of $1, FV of $1, PVA of...
- Q Delta Manufacturing Inc is considering purchasing a new machine to meet increasing demand. The relevant details of three machines are provided below. Assume all sales are cash transactions. Corporate income-tax...
- Q Alpha Industries Ltd wants to upgrade its machinery to increase production. Three machines are being considered, with details as below. Assume all sales are cash transactions. Corporate income-tax rate is...
- Q MNO Enterprises is considering two investment opportunities. The cash flows for each are provided below. The discount rate is 9%.YearProject ZProject Y0-$70,000-$80,0001$20,000$25,0002$25,000$30,0003$15,000$20,0004$10,000$15,000a. Compute the payback period for each project. b....
- Q STU Ltd. has to choose between two mutually exclusive projects that require ?60,000 each and have a life span of 6 years. The required rate of return is 10%, and...
- Q VWX Ltd. is evaluating two projects with an initial investment of ?70,000 each and a life span of 5 years. The company’s required rate of return is 8%, and the...
- Q EFG Consulting has two project proposals. The expected cash flows are given below. The required rate of return is 15%.YearProject A1Project B10-$400,000-$450,0001$120,000$130,0002$130,000$140,0003$140,000$150,0004$150,000$160,000a. Calculate the IRR for each project. b. Determine...
- Q LMN Corporation is evaluating two investment opportunities. The cash flows for each project are as follows. The required rate of return is 8%.YearProject AProject B0-$200,000-$150,0001$60,000$50,0002$70,000$60,0003$80,000$70,0004$90,000$80,000a. Compute the payback period for...
- Q Mu Corporation issues loan notes of €110,000 on 1 January 2038. Redemption is to take place on equal terms, four years later. The company decides to put aside an equal amount...
- Q Evaluate the following two mutually exclusive projects with equal lives and cost outlay but different cash inflow patterns at an 8% cost of capital.YearProject MProject N0(120,000)(120,000)150,00020,000240,00030,000330,00040,000420,00050,000510,00060,000
- Q Omicron Ltd issues loan notes of $125,000 on 1 January 2040. Redemption is to take place on equal terms, five years later. The company decides to put aside an equal amount...
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