Write down the following scenarios as examples of elastic, inelastic, or unit elastic demand.

a. When Ruko, a device used to stream movies at home, increases prices by 39 %, total revenue decreases by 55 %.
b. When Cinema Supreme decreases ticket prices by 5 %, total revenue does not change.
c. When Bluebox, a DVD rental kiosk, increases its prices by 44 %, total revenue increases by 31 %.

Answer and Explanation:

The classification is as follows:

a. In the case when the quantity demanded is more than the price so it is a price elastic demand

b. In the case when the change in price of 1% lower than the change in quantity demanded so it is price inelastic demand

c. And, in the case where there is a change of 1% in a price that generated the 1% change in quantity demanded is unit elastic demand

The management of Ballard MicroBrew is considering the purchase of an automated bottling machine for $61,000. The machine would replace an old piece of equipment that costs $15,000 per year to operate. The new machine would cost $6,000 per year to operate. The old machine currently in use could be sold now for a salvage value of $20,000. The new machine would have a useful life of 10 years with no salvage value. Required: 1. What is the annual depreciation expense associated with the new bottling machine

BSW Corporation has a bond issue outstanding with an annual coupon rate of 5.4 percent paid quarterly and four years remaining until maturity. The par value of the bond is $1,000. Determine the fair present value of the bond if market conditions justify a 11 percent, compounded quarterly, required rate of return. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Katy has one child, Dustin, who is 18 years old at the end of the year. Dustin lived at home for three months during the year before leaving home to work full time in another city. During the year, Dustin earned $15,000. Katy provided more than half of Dustin's support for the year. Which of the following statements regarding whether Katy may claim Dustin as a dependent for the current year is accurate?

a. Yes, Dustin is a qualifying child of Katy.
b. Yes, Dustin fails the residence test for a qualifying child but he is considered a qualifying relative of Katy.
c. No, Dustin fails the support test for a qualifying relative.
d. No, Dustin fails the gross income test for a qualifying relative.

What is the future of discussion of fourms?

Public corporations:
a. are businesses where stock is not used as evidence of ownership.
b. are businesses whose stock is bought and sold privately.
c. are businesses owned by two or more people, each of whom is personally liable for the debts of the business.
d. None of other choices are correct.
e. are businesses whose stock is bought and sold on New York stock exchange only

You are the marketing officer for either a large hotel or a car dealer. Produce a report for
your company's head of marketing in which you explore:
the differences between customer satisfaction and customer delight
ii. the reasons why it is so important to create the sensation of delight among your
customers
iii. the ways in which it could be done.
i.
Illustrate your arguments by examples relevant to your chosen organization, Let the hotel
or car dealership.

On October 21, 2004, Abitibi-Consolidated Inc., a large Canadian-based newsprint and groundwood producer, reported net income for its third quarter, 2004, of $182 million. This compares with a net loss for the same quarter of 2003 of $70 million. Sales for the quarter were up, to $1528 million, and earnings excluding low persistence items, was a loss of $27 million. the low - persistence items included a gain of $239 million before tax from foreign exchange conversion. Much of the company's long term debt is denominated in US dollars. The foreign exchange gain arose because of the rising value of the Canadian dollar, relative to the US dollar, during the quarter. Comparable figures for the third quarter of 2003 were as follows: sales of $ 1,340 mil-lion, a loss before low- persistence items of $ 32 million, and foreign exchange conversion gain of $ 13 million. There is no mention of R& D costs in the company’s third quarter report. Its 2003 annual report mentions R& D only in passing, with reference to forest conservation. Presumably, R& D expenditures are relatively low. Abitibi- Consolidated’s share price rose $ 0.59 to $ 7.29 on the Toronto Stock Exchange on October 21, 2004. The S& P/ TSX Composite index gained 59 points to close at 8,847 on the same day. According to media reports, the increases were driven by a "red- hot" materials and energy sect

A forklift will last for only 2 more years. It costs $5,000 a year to maintain. For $20,000 you can buy a new lift that can last for 10 years and should require maintenance costs of only $2,000 a year. a-1. Calculate the equivalent cost of owning and operating the forklift if the discount rate is 4% per year. (Do not round intermediate calculations. Round your answer to 2 decimal places.) a-2. Should you replace the forklift

Velocity, a consulting firm, enters into a contract to help Burger Boy, a fast-food restaurant, design a marketing strategy to compete with Burger King. The contract spans eight months. Burger Boy promises to pay $87,000 at the end of each month. At the end of the contract, Velocity either will give Burger Boy a refund of $29,000 or will be entitled to an additional $29,000 bonus, depending on whether sales at Burger Boy at year-end have increased to a target level. At the inception of the contract, Velocity estimates an 80% chance that it will earn the $29,000 bonus and calculates the contract price based on the expected value of future payments to be received. At the start of the fifth month, circumstances change, and Velocity revises to 60% its estimate of the probability that it will earn the bonus. At the end of the contract, Velocity receives the additional consideration of $29,000.
Required:
1) Prepare the journal entry to record revenue each month for the first four months of the contract.
2) Prepare the journal entry that the Velocity Company would record after four months to recognize the change in estimate associated with the reduced likelihood that the bonus will be received.
3) Prepare the journal entry to record the revenue each month for the second four months of the contract.
4) Prepare the journal entry after eight months to record receipt of the cash bonus.

Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither.Statement Consumer Surplus Producer Surplus Neither
I sold a jersey sweater for $25, even though I was willing to go as low as $20 in order to sell it.
Even though I was willing to pay up to $32 for a used laptop and even though the seller was willing to go as low as $27 in order to sell it, we couldn't reach a deal because the government imposed a price ceiling of $17 on the sale of laptops.
Even though I was willing to pay up to $48 for a used textbook, I bought a used textbook for only $39.

Consider each of the transactions below. All of the expenditures were made in cash. The Edison Company spent $17,000 during the year for experimental purposes in connection with the development of a new product. In April, the Marshall Company lost a patent infringement suit and paid the plaintiff $10,000. In March, the Cleanway Laundromat bought equipment. Cleanway paid $11,000 down and signed a noninterest-bearing note requiring the payment of $20,500 in nine months. The cash price for this equipment was $28,000. On June 1, the Jamsen Corporation installed a sprinkler system throughout the building at a cost of $33,000. The Mayer Company, plaintiff, paid $17,000 in legal fees in November, in connection with a successful infringement suit on its patent. The Johnson Company traded its old machine with an original cost of $9,900 and a book value of $4,500 plus cash of $9,000 for a new one that had a fair value of $11,500. The exchange has commercial substance. Required: Prepare journal entries to record each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Which of the following events would cause a bank to reduce a depositor's account?

The depositor orders new checks through the bank at a cost of $50.


The bank collects a note receivable and related interest on the depositor's behalf.


There are outstanding checks drawn on the account at month-end.


There are deposits in transit on the account at month-end.


The bank corrects an error from previous month by adding $75 to the depositor account

Tyler Financial Services performs bookkeeping and tax-reporting services to startup companies in the Oconomowoc area. On January 1, 2014, Tyler entered into a 3-year service contract with Walleye Tech. Walleye promises to pay $10,500 at the beginning of each year, which at contract inception is the standalone selling price for these services. At the end of the second year, the contract is modified and the fee for the third year of services is reduced to $9,800. In addition, Walleye agrees to pay an additional $20,600 at the beginning of the third year to cover the contract for 3 additional years (i.e., 4 years remain after the modification). The extended contract services are similar to those provided in the first 2 years of the contract.
1. Prepare the journal entries for Tyler in 2014 and 2015 related to this service contract. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
Jan 1, 2014
Dec 31, 2014
Jan 1, 2015
Dec 31, 2015
2. Prepare the journal entries for Tyler in 2016 related to the modified service contract, assuming a prospective approach. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
Jan 1, 2016
Dec 31, 206
3. Repeat the requirements for part (b), assuming Tyler and Walleye agree on a revised set of services (fewer bookkeeping services but more tax services) in the extended contract period and the modification results in a separate performance obligation. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit
Jan 1, 2016
Dec 31, 2016

Suppose that a project has a depreciable investment of $600,000 and falls under the following accelerated depreciation schedule for tax purposes (standard linear depreciation in the books): year 1: 20 percent; year 2: 32 percent; year 3: 19.2 percent; year 4: 11.5 percent; year 5: 11.5 percent; and year 6: 5.8 percent. Tax rate is 35%. Calculate the annual depreciation schedule and depreciation tax-shield.

Write a two-page business summary including the following sections:

a. Company introduction (general introduction about the company)
b. Business model (how does this business work and generate profit)
c. The current information systems configuration in this company if applicable
d. The potential opportunities using Information Technologies as a strategic tool for this company
e. The trend in this particular business or industry in terms of Information technologies

Toby Toy Store has noticed the following items that need to be considered for its income statement for the year ended December 31, 2019: Commissions of $3,000 for salespeople who made sales in December will be paid on January 3, 2020.

The phone bill of $400 for December was received and will be paid on January 20, 2020.
The store rent of $2,000 for January 2020 was paid on December 28, 2019.
At the beginning of November, Toby paid $1,500 for advertising in a monthly magazine that is distributed in November and December of 2019, and January of 2020.

What is the proper amount of expenses to be included in the income statement for the year?
a. $4,400.
b. $6,900.
c. $6,400.
d. $5,900.

The outstanding capital stock of Coronado Corporation consists of 1,900 shares of $100 par value, 9% preferred, and 5,400 shares of $50 par value common. Assuming that the company has retained earnings of $87,500, all of which is to be paid out in dividends, and that preferred dividends were not paid during the 2 years preceding the current year, state how much each class of stock should receive under each of the following conditions. (a) The preferred stock is noncumulative and nonparticipating. (Round answers to 0 decimal places, e.g. $38,487.) Preferred Common $enter a dollar amount rounded to 0 decimal places 17100 $enter a dollar amount rounded to 0 decimal places 70400 (b) The preferred stock is cumulative and nonparticipating. (Round answers to 0 decimal places, e.g. $38,487.) Preferred Common $enter a dollar amount rounded to 0 decimal places 51300 $enter a dollar amount rounded to 0 decimal places 36200 (c) The preferred stock is cumulative and participating. (Round the rate of participation to 4 decimal places, e.g.1.4278%. Round answers to 0 decimal places, e.g. $38,487.) Preferred Common $enter a dollar amount rounded to 0 decimal places 61332 $enter a dollar amount rounded to 0 decimal places 38556

Aaron, clerical supervisor for a health maintenance organization, wants to hire the best person for the receptionist job. Ramona, his manager, is doubtful that the candidate Aaron has selected will be capable because she uses a wheelchair. Ramona is concerned that other workers will have to spend a lot of time helping the receptionist get in and out of the office for lunch, breaks, and so on. How can Aaron ensure that his candidate will be an asset to the firm?

A machine at a cost of $5,000 was purchased 3 years ago. It can be sold now for $3,000. If the machine is kept, the annual operating and maintenance costs will be $1,500. If it is kept and operated for next five years, determine the amount at time 0 (now) equivalent to the cost of owning and operating the machine for the next five-year period. It is anticipated that the machine can be sold for $1,000 at the end of the five-year period. Use an interest rate of 10%

Vulcan Companyâs contribution format income statement for June is as follows:

Vulcan Company Income Statement For the Month Ended June 30

Sales $750,000
Variable expenses 336,000
Contribution margin 414,000
Fixed expenses 378,000
Net operating income $36,000

Management is disappointed with the companyâs performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following:

a. The company is divided into two sales territoriesâNorthern and Southern. The Northern territory recorded $300,000 in sales and $156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of $120,000 and $108,000 are traceable to the Northern and Southern territories, respectively. The rest of the fixed expenses are common to the two territories.

b. The company is the exclusive distributor for two productsâPaks and Tibs. Sales of Paks and Tibs totaled $50,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and 58% for Tibs. Cost records show that $30,000 of the Northern territoryâs fixed expenses are traceable to Paks and $40,000 to Tibs, with the remainder common to the two products.

Required:
Prepare contribution format segmented income statements.

George Gershwin Co. sold $2,000,000 of 10%, 10-year bonds at 104 on January 1, 2020. The bonds were dated January 1, 2020, and pay interest on July 1 and January 1. If Gershwin uses the straight-line method to amortize bond premium or discount, determine the amount of interest expense to be reported on July 1, 2020, and December 31, 2020.

Bonita Industries pays all salaried employees on a biweekly basis. Overtime pay, however, is paid in the next biweekly period. Bonita accrues salaries expense only at its December 31 year end. Data relating to salaries earned in December 2020 are as follows: Last payroll was paid on 12/26/20, for the 2-week period ended 12/26/20. Overtime pay earned in the 2-week period ended 12/26/20 was $26000. Remaining work days in 2020 were December 29, 30, 31, on which days there was no overtime. The recurring biweekly salaries total $445000.

Assuming a five-day workweek, Bonita should record a liability at December 31, 2020 for accrued salaries of:________

Calculating Earnings per Share Little, Inc., reported earnings of $162,000 for 2013, and at the end of the year, had the following securities outstanding: 60,000 shares of common stock. (The year-end share price was $25 per share). Employee stock options for the purchase of 8,000 common shares at an exercise price of $22 per share. (The options are fully vested).
(a) Calculate the basic earnings per share for Little, Inc. for 2013. Round to two decimal places.
(b) Calculate the diluted earnings per share for Little, Inc. for 2013. Round to two decimal places.

Freedom Company had 450,000 shares of common stock issued as of December 31, 2020. 350,000 had been issued and outstanding as of January 1, 2020 and 100,000 of which were issued on September 1, 2020. Net income for the year ended December 31, 2020, was $1,160,000. What should be Freedom Company's 2020 earnings per common share, rounded to the nearest penny

Below are transactions for Wolverine Company during 2021.

a. On December 1, 2021, Wolverine receives $3,100 cash from a company that is renting office space from Wolverine. The payment, representing rent for December and January, is credited to Deferred Revenue.
b. Wolverine purchases a one-year property insurance policy on July 1, 2021, for $12,120. The payment is debited to Prepaid Insurance for the entire amount.
c. Employee salaries of $2,100 for the month of December will be paid in early January 2022.
d. On November 1, 2021, the company borrows $10,500 from a bank. The loan requires principal and interest at 10% to be paid on October 30, 2022.
e. Office supplies at the beginning of 2021 total $910. On August 15, Wolverine purchases an additional $2,500 of office supplies, debiting the Supplies account. By the end of the year, $410 of office supplies remains.

Required:
Record the necessary adjusting entries at December 31, 2018, for Wolverine Company.

Last year Kruse Corp had $440,000 of assets (which is equal to its total invested capital), $403,000 of sales, $28,250 of net income, and a debt-to-total-capital ratio of 39%. The new CFO believes the firm has excessive fixed assets and inventory that could be sold, enabling it to reduce its total assets and total invested capital to $252,500. The firm finances using only debt and common equity. Sales, costs, and net income would not be affected, and the firm would maintain the same capital structure (but with less total debt). By how much would the reduction in assets improve the ROE

Which of the following about writing and revising business documents is most accurate? a. Experienced business writers rarely need to revise. b. Revision is not necessary for informal documents such as internal memos or e-mail messages. c. The real work of revision should happen in the writing stage as you select words and form sentences.

Manufacturing overhead was estimated to be $249,600 for the year along with 20,800 direct labor hours. Actual manufacturing overhead was $219,000, and actual labor hours were 21,900. The amount debited to the Manufacturing Overhead account would be: Multiple Choice $219,000. $249,600. $233,000. $262,800.

Dodie Company completed its first year of operations on December 31. All of the year's entries have been recorded except for the following:

a. At year-end, employees earned wages of $4,000, which will be paid on the next payroll date in January of next year.
b. At year-end, the company had earned interest revenue of $1,500. The cash will be collected March 1 of the next year.

Required:
a. What is the annual reporting period for this company?
b. Identify whether each transaction results in adjusting a deferred or an accrued account. Using the process illustrated in the chapter, prepare the required adjusting entry for transactions ( a ) and ( b Include appropriate dates and write a brief explanation of each entry.
c. Why are these adjustments made?

Sales for the year were $83,000. The balance sheet at the end of the year is given below:

Assets Liabilities and Equity
Cash 12,000 Accounts payable 19,000
Marketable securities 2,000 Notes payable 6,000
Accounts receivable 6,000 Current liabilities 25,000
Inventory 41,000 Long-term debt 95,000
Current assets 61,000 Total liabilities 120,000
Machines 34,000 Paid-in capital 20,000
Real estate 80,000 Retained earnings 35,000
Net fixed assets 114,000 Equity 55,000
Total assets 149,000 Total lib. & equity 149,000

Required:
What is the firm's days' sales in inventory?