Chapter 4 Solutions Essay

When Oprah gave away Pontiac G6 sedans to her TV audience, was the value of the cars taxable? On Labor Day weekend in 2006, World Furniture Mall in Plano, Illinois, gave away $275,000 of furniture because the Chicago Bears shut out the Green Bay Packers in the team’s football season opener at Lambeau Field in Green Bay (26-0). Was the free furniture in the form of a discount or rebate taxable, or should the furniture company have handed the customers a Form 1099-MISC?

6. Note 8 states Harnischfeger’s allowance for doubtful accounts. Compute the ratio of the allowance to gross receivables (receivables before the allowance) in 1983 and 1984. What would the allowance have been if the company maintained the ratio at the 1983 level? How much did the pre-tax income increase as a result of the changed ratio in 1984?

1. a. The simulation indicates that 584 is the optimum stocking quantity. Daily profit at this stocking quantity is $331.4346.

6. Note 8 states Harnischfeger’s allowance for doubtful accounts.  Compute the ratio of the allowance to gross receivables (receivables before the allowance) in 1983 and 1984.  What would the allowance have been if the company maintained the ratio at the 1983 level?  How much did the pre-tax

Note: we are using end-of-year balance sheet items (rather than averages) in order to have three comparison years and to recognize that the firm’s business model (from a retailer of products manufactured by others to a manufacturer/wholesaler of eco-friendly products.

In this chapter, as in many other chapters, he intersperses short sentences into his narrative. In fact, some of his paragraphs in this chapter are only 1 sentence long. What kind of information is conveyed in these short paragraphs?

How should we schedule employees this week? When should we schedule delivery for each batch of product? How should customer service people answer the phones?

2. For the most recent year, what is the amount of inventory in the balance sheet? What does this amount represent?

Q6. XYZ Ltd is a publicly listed company which has suffered from major sales declines, due to increased foreign completion, and has made a succession of losses over the past three years. During the year, its CEO resigned and was replaced by Chief Operating Officer (COO). The trial balance reveals that sales were $10,000,000 and the company made a loss of $500,000. At what level

We will assume that Number  Name where name is not unique (i.e., there may be more than one “John Smith”, each with a different student number). Then the multivalued dependencies are:

INVESTools should definitely capitalize these expenses. The practice of not capitalizing these expenses has led to routine recording of net losses

Jones over forecasts his inventory and has a low inventory turnover ratio. This drastically increases his accounts payable, as he isn’t able to pay due to low cash inflow. His account’s payable increased by nearly 9 percent in 2006. Nearly half of his current assets are in inventory. Also Jones isn’t able to take advantage of the cash discounts offered by his suppliers due to his slow cash collection process. In order to perform well, the company must improve its inventory system and its cash collection policies.

Milligan’s Backyard Storage Kits, a mail order company, sells a variety of backyard storage unit kits and landscaping decorations to its customers. Although the company makes a profit, David Milligan, the company’s owner, realizes that he can improve his company’s operations if he better manages his inventory. Mr. Milligan requests your help in preparing an Inventory Analysis worksheet. The Inventory Analysis worksheet provides Mr. Milligan with information about his annual sales, cost of goods sold, gross profit, and markup on this products. Preparing the worksheet for Mr. Milligan requires you to insert columns, use several functions, and apply proper formatting to the

a. Design the logic for a program that allows a user to enter 10 numbers, then

January 2000, a major shortfall in profits relative to previous expectations. In June, the quarterly