...Alfred Auletta 16 September 2012 Professor Shahid ACC 301 CA 7-1 (Bad-debt Accounting) A. What are the deficiencies of the direct write-off method? The deficiency of the direct write-off method is that it fails to match the costs with the revenues in a specific period. It also does not show the net realizable value of receivables in the balance sheet. The only time that the direct write-off method is appropriate is when the amount that is uncollectible is deemed immaterial. B. What are the two basic allowance methods used to estimate bad debts, and what is the theoretical justification for each? The two basic allowance methods used to estimate the bad debts are the Percentage-of-sales approach and the Percentage-of-receivables approach. With the percentage-of-sales approach, the expense is getting matched with the revenue because it is showing the relation between the charge and the sale in a specific period. Using this method, it is being shown the past relationship between the sales and costs in a period. Simms Company would be anticipating for the future based on the costs and revenues. It is also known as the Income Statement Approach. When using the percentage-of-receivables approach, the company could find out what percentage of their receivables would be deemed uncollectible. The Simms Company would find out the actual value of their receivables instead of having to wait. The difference between this method and the other is the fact that...
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...Relations > Deloitte Foundation Global site selector Go Search Search Top searches Top searchesBookmark Email Print this page Increase font Alliances Catalyst for Innovation Community Involvement Corporate Responsibility Deloitte’s sponsorship of the U.S. Olympic Committee Inclusion Deloitte University Ethics & Independence Deloitte Life Growth Through Acquisition History Investor Confidence Leadership University Relations Deloitte Foundation Faculty Resources Faculty and Ph.D. Support Life, Inc. Student Events The Trueblood Case Studies DOWNLOAD For a complete index of Cases and Addendum summary please click the download button above. The Trueblood Series cases and solutions are available in Adobe PDF format below. Solutions are password protected for faculty use only. Access to solutions by other unauthorized individuals is strictly prohibited. To find out how to obtain access to the case solutions, please contact us via e-mail or mail a request on your school letterhead to: Deloitte Foundation Ten Westport Road Wilton, CT 06897 Due to the...
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...stock! Intermediate Macroeconomics Motivation The Extended Solow Model Growth of Total Capital and Output What are the growth rates of total output and capital outside the steady state? Total Capital: K ) AN K AN K AN A A K = K N K ) = N K K AN K AN + gA + gN Total Output: Y = K ↵ (AN)1 ↵ K Y =↵ + (1 ) Y K ↵) ✓ A N + A N ◆ Plugging in from above: Y =↵ Y K AN K AN ! + gA + gN +(1 ↵)(gA +gN ) = ↵ Andre Switala Intermediate Macroeconomics K AN K AN +gA +gN Motivation The Extended Solow Model Capital per E↵ective Worker We know that the growth rate of capital per e↵ective worker is negative in the transition to the new steady state and that it becomes less negative over time. Intermediate Macroeconomics Motivation The Extended Solow Model Time Paths of Total Capital The trend in both steady states is the same, however the levels are di↵erent! What happens to the capital stock over time depends on the parameters at time t = t0 : K AN K AN > gA + gN K AN K AN < gA + gN Intermediate Macroeconomics Motivation The Extended Solow Model Case 1 Graphically There is also a graphical interpretation of how to find out in which case we are: Intermediate Macroeconomics Motivation The Extended Solow Model Case 2 Graphically There is also a graphical interpretation of how to find out in which case we are: Intermediate Macroeconomics ...
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...Case Study: Out-of-Town Brown and the Besieged Probation Supervisor Zacarias Sambula Jr, Derrick Cooper, Kenisha Smith, Harshvir Sekhon CJA/454 Criminal Justice Theory and Practice April 01, 2013 David Pettinari Case Study: Out-of-Town Brown and the Besieged Probation Supervisor Intro Question#1 Question#2 The mental and physical trauma experienced by the 23-year-old man from his stepfather was enough to send him over the edge and murder his stepfather. The boy never had a chance for a decent life. Many prosecutors would have a hard time sending him to jail because of the mental state in which the 23-year-old man was at the time. It is important to consider that there is no criminal record. According to, the young man’s report there is no prior record and had been an incest victim because he was five; otherwise he is a nonviolent person, a low recidivism risk. Because of the situation intermediate sanctions will benefits the young man because he will be able to get the treatment he needs. Intermediate sanctions serve multiple purposes aside from keeping the young man out of jail for treatment. It also allows the prison system to reduce the population, make room for the more serious offenders, provide non-violent offenders with opportunity at a second chance, offers a wide range of rehabilitation programs and treatments. While in intermediate sanctions the young man’s activities will be restricted while receiving the help he needs, at the same time hold...
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...INTERMEDIATE (FINANCIAL) ACCOUNTING I SUBCLASS KLM CASE ANALYSIS QUESTIONS CASE 1 – REVENUE RECOGNITION AND EARNINGS MANAGEMENT INTERMEDIATE (FINANCIAL) ACCOUNTING I SUBCLASS KLM CASE ANALYSIS QUESTIONS CASE 2 – REVENUE RECOGNITION FOR A CONSTRUCTION PROJECT HKU Technology Inc. (Hereafter, HKU Tech) is a large construction contracting firm that serves a variety of industrial customers that purchase machinery and equipment from HKU Tech. HKU Tech’s business primarily involves the design and manufacture of large, industrial machinery and tooling that is used by its customers in manufacturing parts and components for fighter jets, transport planes, and other aerospace-related machinery and equipment. All of HKU Tech’s construction contracts involve the design, development, and manufacture of machines that are unique and customized to the specifications of its customers. HKU Tech negotiates all its contracts with its customers on either a fixed-price or cost-plus basis. HKU Tech has developed an accounting policy to recognize revenue related to its customized construction contracts, which is outlined as follows: The Company performs under a variety of contracts, some of which provide for reimbursement of cost plus fees, and others that are fixed-price-type contracts. Revenues and fees on these contracts are primarily recognized on a contract-by-contract basis using the percentage-ofcompletion method of accounting, which is most often based on contract costs incurred to date compared...
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...tax rate is 40%, and the discount rate is 12%. a. Calculate the equivalent annual cost of each alternative: (Do not round intermediate calculations. Enter your answers in millions rounded to 3 decimal places.) Equivalent Annual Cost Quick & Dirty $3.668 million Do-It-Right $3.553 million b. Which system should Blooper install? Do-It-Right Explanation: a. Find the equivalent annual cost of each alternative: Quick and Dirty Do-It-Right Operating costs $3 million $3 million Investment $16 million $18 million Project life 4 years 5 years Annual depreciation $4 million $3.6 million Depreciation tax shield $1.6 million $1.44 million PV(depreciation tax shield)* $4.86 million $5.191 million Net capital cost† $11.14 million $12.809 million EAC of net capital cost* $3.668 million $3.553 million *Annuity discounted at 12%; number of years = project life. †Investment − PV(depreciation tax shield). The present value of the depreciation tax shield for each alternative is computed as follows: PV= $1.600 MILLION {1/0.12 -1/0.12 (1.12)4 }= $4.860 MILLION PV= $1.440 MILLION {1/0.12 -1/0.12 (1.12)5}= $5.191 MILLION The equivalent annual cost (EAC) for each alternative is computed as follows: C X {1/0.12-1/0.12 X (1.12)4}=$11.140 million>...
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...-------------------------------------- 1. When student is admitted for CA Final Course? Student after passing Intermediate/ Professional Education (Examination-II)/ Professional Competence Examination/ Integrated Professional Competence Examination (IPCE)/ Intermediate (IPC) Examination in its entirety can enroll for CA Final Course. Students, who pass IPCE / Intermediate (IPC) Examination in its entirety, are required to register for Final course immediately and start preparation for Final Examination. 2. What is the Final Course registration fee payable by students who passes Integrated Professional Competence Examination (IPCE)/ Intermediate (IPC) Examination? Student who has passed Integrated Professional Competence Examination (IPCE)/ Intermediate (IPC) Examination are required to pay the following fee while registering for Final Course: Admission to Final Course Registration Fee (INR) Registration Fee (US$) After passing IPCE/ Intermediate (IPC) Examination Rs. 10,000/- + Rs. 2,000 towards Article Registration Fee, if not paid earlier 750 + 50 towards Article Registration fee, if not paid earlier 3. What are the eligibility criteria for different scheme to appear in the Final Examination? Eligibility criteria for appearing in the Final examination are given below: Sl. No. Category of Students Eligibility Criteria to appear in the Final Examination 1 Students who have registered and passed Intermediate examination and registered for Final Course...
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...Intermediate Accounting 2 Week 2 - Answer Marks will be awarded with logical argumentation and appropriate presentation of the answers. Answer to question 1 1 Definition of liability: A present obligation arising from a past event, the settlement of which is expected to result in an outflow of resources embodying benefits (i.e. usually a cash payment) There are two types of event creating obligation a) Legal – arises from the conclusion of legal contract, legislation or other operation of law. Example: repair warranty in sales agreement Constructive – derives from the actions of the enterprise where: Past actions – by an established pattern of past practice, published policies or a sufficiently specific current statement, the enterprise has indicated to other parties that it will accept certain responsibilities; and Created valid expectations – as a result, the enterprise has created valid expectations on the part of those parties that it will discharge those responsibilities For example: manufacturer has repaired any faulty items free of charge though there is no warranty in the sales agreement 3. Provision is a liability of uncertain timing or amount. It is accrued on the statement of financial position as it is probable it will be settled and a reliable estimate can be made of the amount that will be settled. Application of the recognition and measurement rules Future operating losses Do not meet the definition of liability and no provision should be made. Onerous contracts...
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...PEGN 361: Completion Engineering Section A Maurice Polycarp MPOLYCAR Project 2 Pages: Date: 4/20/2016 Minimum Casing Requirement (Onshore) There are a few types of casings which are commonly installed. Therefore, it is imperative to understand the design criteria for these casings in order to prevent any well problems. 1) Conductor Casing Conductor casing is the first pipe installed in the wellbore. It is shallow and serves to prevent the hole from washing out under the rig. It also supports the weight of other casing strings. Besides, it returns drilling fluids to elevated pits while drilling the next section of the well. For the burst design of conductor casing, the internal pressure should be the lower value of either the 2) Surface Casing Surface casing serves to protect freshwater aquifer and also protects the borehole from potentially poor shallow formations. It is also the initial anchor for the blowout prevention equipment (BOPE). It also helps suspend the weight of the remaining casing strings....
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...Money Solutions to Problems P4-1. LG 1: Using a Time Line Basic (a), (b), and (c) Compounding Future Value –$25,000 $3,000 $6,000 $6,000 $10,000 $8,000 $7,000 |—————|—————|——————|——————|—————|——————|—> 0 1 2 3 4 5 6 End of Year Present Value Discounting (d) Financial managers rely more on present than future value because they typically make decisions before the start of a project, at time zero, as does the present value calculation. 74 Part 2 Important Financial Concepts P4-2. LG 2: Future Value Calculation: FVn = PV × (1 + i)n Basic Case A B C D FVIF12%,2 periods FVIF6%,3 periods FVIF9%,2 periods FVIF3%,4 periods = (1 + 0.12)2 = 1.254 = (1 + 0.06)3 = 1.191 = (1 + 0.09)2 = 1.188 = (1 + 0.03)4 = 1.126 P4-3. LG 2: Future Value Tables: FVn = PV × (1 + i)n Basic Case A (a) 2 = 1 × (1 + 0.07)n 2/1 = (1.07)n 2 = FVIF7%,n 10 years< n < 11 years Nearest to 10 years Case B (a) 2 = 1 × (1 + 0.40)n 2 = FVIF40%,n 2 years < n < 3 years Nearest to 2 years Case C (a) 2 = 1 × (1 + 0.20)n 2 = FVIF20%,n 3 years < n < 4 years Nearest to 4 years Case D (a) 2 = 1 × (1 + 0.10)n 2 = FVIF10%,n 7 years < n < 8 years Nearest to 7 years (b) 4 = 1 × (1 + 0.07)n 4/1 = (1.07)n 4 = FVIF7%,n 20 years < n < 21 years Nearest to 20 years (b) 4 = (1 + 0.40)n 4 = FVIF40%,n 4 years < n < 5 years Nearest to 4 years (b) 4 = (1 + 0.20)n 4 = FVIF20%,n 7 years < n < 8 years Nearest to 8 years (b) 4 = (1 + 0.10)n 4 = FVIF40%,n 14 years < n 0 1 2 3 4 9 10 End of Year 88 Part...
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...Problems P4-1. LG 1: Using a Time Line Basic (a), (b), and (c) Compounding Future Value –$25,000 $3,000 $6,000 $6,000 $10,000 $8,000 $7,000 |—————|—————|——————|——————|—————|——————|—> 0 1 2 3 4 5 6 End of Year Present Value Discounting (d) Financial managers rely more on present than future value because they typically make decisions before the start of a project, at time zero, as does the present value calculation. 74 P4-2. Part 2 Important Financial Concepts LG 2: Future Value Calculation: FVn = PV × (1 + i)n Basic Case A B C D P4-3. FVIF12%,2 periods FVIF6%,3 periods FVIF9%,2 periods FVIF3%,4 periods = (1 + 0.12)2 = 1.254 = (1 + 0.06)3 = 1.191 = (1 + 0.09)2 = 1.188 = (1 + 0.03)4 = 1.126 LG 2: Future Value Tables: FVn = PV × (1 + i)n Basic Case A (a) 2 = 1 × (1 + 0.07)n 2/1 = (1.07)n 2 = FVIF7%,n 10 years< n < 11 years Nearest to 10 years Case B (a) 2 = 1 × (1 + 0.40)n 2 = FVIF40%,n 2 years < n < 3 years Nearest to 2 years Case C (a) 2 = 1 × (1 + 0.20)n 2 = FVIF20%,n 3 years < n < 4 years Nearest to 4 years Case D (a) 2 = 1 × (1 + 0.10)n 2 = FVIF10%,n 7 years < n < 8 years Nearest to 7 years P4-4. (b) 4 = 1 × (1 + 0.07)n 4/1 = (1.07)n 4 = FVIF7%,n 20 years < n < 21 years Nearest to 20 years (b) 4 = (1 + 0.40)n 4 = FVIF40%,n 4 years < n < 5 years Nearest to 4 years (b) 4 = (1 + 0.20)n 4 = FVIF20%,n 7 years < n < 8 years Nearest to 8 years (b) 4 = (1 + 0.10)n 4...
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...Diamond Foods, Inc.: Anatomy and Motivations of Earnings Manipulation Mahendra R. Gujarathi ABSTRACT: Diamond Foods is America’s largest walnut processor specializing in processing, marketing, and distributing nuts and snack products. This real-world case presents financial reporting issues around the commodities cost shifting strategy used by Diamond’s management to falsify earnings. By delaying the recognition of a portion of the cost of walnuts acquired into later accounting periods, Diamond Foods materially underreported the cost of sales and overstated earnings in fiscal 2010 and 2011. The primary learning goal of the case is to help students understand the anatomy and motivations of earnings manipulation. Specifically, students will have the opportunity to (1) apply the FASB’s Conceptual Framework to a real-world context, (2) determine the nature of errors and compute their numerical effects on financial statements, (3) understand motivations for earnings management and actions needed for managing earnings of future years, (4) explain the anatomy of financial reporting fraud by reconstructing journal entries, (5) prepare comparative financial statements for retroactive restatements, (6) explain the rationale for clawback provisions in compensation contracts, and (7) understand the difference between the real and accrual-based earnings management. Keywords: earnings management; financial statement fraud; restatements; error correction; clawback provision; Conceptual Framework...
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...Case Problem: Stateline Shipping and Transport Company Assignment #4 Case Problem: Stateline Shipping and Transport Company MAT540: Quantitative Methods Vargha Azad 09/08/13 In Excel, or other suitable program, develop a model for shipping the waste directly from the 6 plants to the 3 waste disposal sites. Solve the model you developed in #1 (above) and clearly describe the results. In Excel, or other suitable program. Develop a transshipment model in which each of the plants and disposal sites can be used as intermediate points. 6 Plants labeled 1 through 6, 3 waste facilities labeled A through C Objective function: Minimize Z = 1A(12) + 1B(15) + 1C(17) + 2A(14) + 2B(9) + 2C(10) + 3A(13) + 3B(20) + 3C(11) + 4A(17) + 4B(16) + 4C(19) + 5A(7) + 5B(14) + 5C(12) + 6A(22) + 6B(16) + 6C(18); Subject to: 1A + 1B + 1C = 35 2A + 2B + 2C = 26 3A + 3B + 3C = 42 4A + 4B + 4C = 53 5A + 5B + 5C = 29 6A + 6B + 6C = 38 1A + 2A + 3A + 4A + 5A + 6A ≤ 65 1B + 2B + 3B + 4B + 5B + 6B ≤ 80 1C + 2C + 3C + 4C + 5C + 6C ≤ 105 All Combinations ≥ 0 Solver add-on solution in MS Excel yielded the following results: 35 bbl of wastes shipped from Kingsport to Whitewater, 26 bbl of waste shipped from Danville to Duras, 42 bbl of wastes shipped from Macon to Duras, 1 bbl of wastes shipped from Selma to Whitewater, 52 bbl of wastes shipped from Selma to Los Canos, 29 bbl of wastes shipped from...
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...CHAPTER 13 Current Liabilities and Contingencies ASSIGNMENT CLASSIFICATION TABLE (BY TOPIC) Topics 1. Concept of liabilities; definition and classification of current liabilities. Accounts and notes payable; dividends payable. Short-term obligations expected to be refinanced. Deposits and advance payments. Compensated absences. Collections for third parties. Contingent liabilities (General). Guaranties and warranties. Premiums and awards offered to customers. Self-insurance, litigation, claims, and assessments, asset retirement obligations. Presentation and analysis. Questions 1, 2, 3, 4, 6, 8 7, 11 9, 10 12, 5 13, 14, 15 16 17, 18, 19, 20, 22 21, 23 24, 25 26, 27, 28 1, 2, 3 4 5 8, 9 6, 7 10, 11 13, 14 15 12 5, 6, 16 7, 8, 9, 16 13, 16 10, 11, 16 12, 15, 16 14 3, 4 10, 11, 13 5, 6, 7, 12, 14 8, 9, 12, 14 2, 10, 11, 13 9 6, 7 5, 6, 7 7, 8 Brief Exercises Exercises 1, 16 Problems 1, 2 Concepts for Analysis 1 2. 3. 4. 5. 6. 7. 8. 9. 10. 2, 16 3, 4 1, 2 1, 2 3, 4 2 11. 29, 30, 31 17, 18, 19 3 Copyright © 2010 John Wiley & Sons, Inc. Kieso, Intermediate Accounting, 13/e, Solutions Manual (For Instructor Use Only) 13-1 ASSIGNMENT CLASSIFICATION TABLE (BY LEARNING OBJECTIVE) Learning Objectives 1. 2. 3. 4. 5. Describe the nature, type, and valuation of current liabilities. Explain the classification issues of short-term debt expected to be refinanced. Identify types of employee-related liabilities. Identify the criteria used to account for...
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...CHAPTER 23: TRANSFER PRICING Chapter Contents: - Definition and Overview - Transfer Pricing Options - Market-based Transfer Prices - Cost-based Transfer Prices - Negotiated Transfer Prices - Survey of Practice - External Reporting - Dual Transfer Pricing - Transfer Pricing and Multinational Income Taxes - Other Regulatory Issues Definition and Overview: A transfer price is what one part of a company charges another part of the same company for goods or services. In the excerpt from Casablanca, Rick apparently loaned Ferrari 100 cartons of cigarettes for which he was never repaid. Now that Ferrari owns both the Blue Parrot and Rick’s Café, he jokes about the fact that what was previously a debt that he owed to Rick, is now a “debt” from one nightclub that he owns to another nightclub that he owns. If Ferrari continues to transfer cartons of cigarettes between the two clubs, he might wish to establish a “transfer price” for cigarettes, but knowing Ferrari, he won’t bother. We will restrict attention to transfers that involve a tangible product, and we will refer to the two corporate entities engaged in the transfer as divisions. Hence, the transfer price is the price that the “selling” division charges the “buying” division for the product. Because objects that float usually flow downstream, the selling division is called the upstream division and the buying division is called the downstream division...
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