Question: Sales of Cool-Man air conditioners have

> What reporting requirements does retrospective application require?

> What information should a lessee disclose about its capital leases in its financial statements and footnotes?

> If an employer has a defined benefit pension plan, what components would make up its net periodic pension cost?

> A company wishes to conduct business in a foreign country that attracts businesses by granting “holidays” from income taxes for a certain period of time. Would the company have to disclose this “holiday” to the SEC? If so, what information must be disclo

> Is the installment-sales method of recognizing revenue generally acceptable? Why or why not?

> IFRS prohibits the use of the completed-contract method in accounting for long-term contracts. If revenues and costs are difficult to estimate, how must companies account for long-term contracts?

> In this simulation, you are asked to address questions related to the accounting for leases. Prepare responses to all parts. (Round amounts to the nearest cent.) KWW_Professional_Simulation Accounting for Leases Time Remaining 1 hour 40 minutes Unap

> Wertz Construction Company decided at the beginning of 2012 to change from the completed contract method to the percentage-of-completion method for financial reporting purposes. The company will continue to use the completed-contract method for tax purpo

> Access the glossary (“Master Glossary”) to answer the following. (a) What is a deferred tax asset? (b) What is taxable income? (c) What is the definition of valuation allowance? (d) What is a deferred tax liability?

> Ray Bond, from Problem 1-16, is trying to find a new supplier that will reduce his variable cost of production to $15 per unit. If he was able to succeed in reducing this cost, what would the break-even point be? Problem 1-16: Ray Bond sells handcrafte

> Ray Bond sells handcrafted yard decorations at county fairs. The variable cost to make these is $20 each, and he sells them for $50. The cost to rent a booth at the fair is $150. How many of these must Ray sell to break even?

> Gina Fox has started her own company, Foxy Shirts, which manufactures imprinted shirts for special occasions. Since she has just begun this operation, she rents the equipment from a local printing shop when necessary. The cost of using the equipment is $

> A card is drawn from a standard deck of playing cards. For each of the following pairs of events, indicate if the events are mutually exclusive, and indicate if the events are exhaustive. (a) Draw a spade and draw a club. (b) Draw a face card and draw a

> The Webster Manufacturing Company produces a popular type of serving cart. This product, the SL72, is made from the following parts: 1 unit of part A, 1 unit of part B, and 1 unit of subassembly C. Each subassembly C is made up of 2 units of part D, 4 un

> Jerry Smith is thinking about opening a bicycle shop in his hometown. Jerry loves to take his own bike on 50-mile trips with his friends, but he believes that any small business should be started only if there is a good chance of making a profit. Jerry c

> A group of medical professionals is considering the construction of a private clinic. If the medical demand is high (i.e., there is a favorable market for the clinic), the physicians could realize a net profit of $100,000. If the market is not favorable,

> Refer to Problem 3-33 for details about the game of roulette. Another bet in a roulette game is called a “straight up” bet, which means that the player is betting that the winning number will be the number that she chose. In a game with 0 and 00, there i

> Megley Cheese Company is a small manufacturer of several different cheese products. One of the products is a cheese spread that is sold to retail outlets. Jason Megley must decide how many cases of cheese spread to manufacture each month. The probability

> Today’s Electronics specializes in manufacturing modern electronic components. It also builds the equipment that produces the components. Phyllis Weinberger, who is responsible for advising the president of Today’s Ele

> What is the variance, and what does it measure? How is it computed for a discrete probability distribution?

> Allen Young has always been proud of his personal investment strategies and has done very well over the past several years. He invests primarily in the stock market. Over the past several months, however, Allen has become very concerned about the stock m

> Develop an opportunity loss table for the investment problem that Mickey Lawson faces in Problem 3-20. What decision would minimize the expected opportunity loss? What is the minimum EOL? Problem 3-20: Mickey Lawson is considering investing some money

> Kenneth Brown is the principal owner of Brown Oil, Inc. After quitting his university teaching job, Ken has been able to increase his annual salary by a factor of over 100. At the present time, Ken is forced to consider purchasing some more equipment for

> The computer output given below is for Problem 7-31. Use this to answer the following questions. Problem 7-31: Consider the following LP problem: Maximize profit = 5X + 6 Y subject to 2X + Y ≤ 120 2X + 3Y ≤ 240 X, Y ≥ 0 (a) How much coul

> Teresa Granger is the manager of Chicago Cheese, which produces cheese spreads and other cheese-related products. E-Z Spread Cheese is a product that has always been popular. The probability of sales, in cases, is as follows: A case of E-Z Spread Chees

> Use the F table in Appendix D to find the value of F for the upper 1% of the F distribution with The F table in Appendix D: Continue to next page… // // (a) df1 = 15, df2 = 6 (b) df1 = 12, df2 = 8 (c) df1 = 3, df2 = 5 (d) df1 = 9, df2 =

> Use the F table in Appendix D to find the value of F for the upper 5% of the F distribution with The F table in Appendix D: Continue to next page… // // (a) df1 = 5, df2 = 10 (b) df1 = 8, df2 = 7 (c) df1 = 3, df2 = 5 (d) df1 = 10, df2 =

> Examine the LP formulation in Problem 7-29. The problem’s second constraint reads 6X + 4Y ≤ 24 hours 1time available on machine 22 If the firm decides that 36 hours of time can be made available on machine 2 (namely, an additional 12 hours) at an additio

> Georgia Products offers the following discount schedule for its 4- by 8-foot sheets of good-quality plywood: ORDER UNIT COST ($) 9 sheets or less ………………………………….. 18.00 10 to 50 sheets …………………………………… 17.50 More than 50 sheets …………………………… 17.25 Home S

> Graphically analyze the following problem: Maximize profit = $4X + $6Y subject to X + 2Y ≤ 8 hours 6X + 4Y ≤ 24 hours (a) What is the optimal solution? (b) If the first constraint is altered to X + 3Y ≤ 8, does the feasible region or optimal

> What is the expected value, and what does it measure? How is it computed for a discrete probability distribution?

> For the data in Problem 5-44, develop an exponential smoothing model with a smoothing constant of 0.3. Using the MSE, compare this with the model in Problem 5-44. Problem 5-44: The following table gives the average monthly exchange rate between the U.S.

> The following table gives the average monthly exchange rate between the U.S. dollar and the euro for 2009. It shows that 1 euro was equivalent to 1.289 U.S. dollars in January 2009. Develop a trend line that could be used to predict the exchange rate for

> Cars arrive at Carla’s Muffler Shop for repair work at an average of 3 per hour, following an exponential distribution. (a) What is the expected time between arrivals? (b) What is the variance of the time between arrivals?

> Using the data in Problem 2-43, determine the probability of more than 3 visits for emergency room service on any given day. Problem 2-43: Patients arrive at the emergency room of Costa Valley Hospital at an average of 5 per day. The demand for emergen

> Jan Gentry is the owner of a small company that produces electric scissors used to cut fabric. The annual demand is 8,000 scissors, and Jan produces the scissors in batches. On average, Jan can produce 150 scissors per day, and during the production proc

> Annual demand for the Dobbs model airplane kit is 80,000 units. Albert Dobbs, president of Dobbs’ Terrific Toys, controls one of the largest toy companies in Nevada. He estimates that the ordering cost is $40 per order. The carrying cost is $7 per unit p

> Shoe Shine is a local retail shoe store located on the north side of Centerville. Annual demand for a popular sandal is 500 pairs, and John Dirk, the owner of Shoe Shine, has been in the habit of ordering 100 pairs at a time. John estimates that the orde

> Ken Ramsing has been in the lumber business for most of his life. Ken’s biggest competitor is Pacific Woods. Through many years of experience, Ken knows that the ordering cost for an order of plywood is $25 and that the carrying cost is 25% of the unit c

> Linda Lechner is in charge of maintaining hospital supplies at General Hospital. During the past year, the mean lead time demand for bandage BX-5 was 60. Furthermore, the standard deviation for BX-5 was 7. Linda would like to maintain a 90% service level

> Barbara Bright is the purchasing agent for West Valve Company. West Valve sells industrial valves and fluid control devices. One of the most popular valves is the Western, which has an annual demand of 4,000 units. The cost of each valve is $90, and the

> John Smith has developed the following forecasting model: Ŷ = 36 + 4.3X1 where Ŷ = demand for K10 air conditioners X1 = the outside temperature (℉) (a) Forecast the demand for K10 when the temperature is 70℉. (b) What is the demand for a temperature of 8

> Jim Overstreet, inventory control manager for Itex, receives wheel bearings from Wheel-Rite, a small producer of metal parts. Unfortunately, Wheel-Rite can produce only 500 wheel bearings per day. Itex sreceives 10,000 wheel bearings from Wheel-Rite each

> Annual rainfall plays an important role in corn agriculture. The drought of 2011 literally affected corn prices for years. Given the following data, build a model and predict the harvest for 2016 given that the total rainfall was 6.45 inches. Critique yo

> Trowbridge Manufacturing produces cases for personal computers and other electronic equipment. The quality control inspector for this company believes that a particular process is out of control. Normally, only 5% of all cases are deemed defective due to

> If 10% of all disk drives produced on an assembly line are defective, what is the probability that there will be exactly one defect in a random sample of 5 of these? What is the probability that there will be no defects in a random sample of 5?

> Gary Schwartz is the top salesman for his company. Records indicate that he makes a sale on 70% of his sales calls. If he calls on four potential clients, what is the probability that he makes exactly 3 sales? What is the probability that he makes exactl

> It takes approximately eight working days for an order of number 6 screws to arrive once the order has been placed. (Refer to Problem 6-20.) The demand for number 6 screws is fairly constant, and on average, Lila has observed that her brother’s hardware

> Use a 3-year moving average forecasting model to forecast the sales of Cool-Man air conditioners (see Problem 5-22). Problem 5-22: Sales of Cool-Man air conditioners have grown steadily during the past 5 years: The sales manager had predicted, before

> Develop a trend line for the demand for fertilizer in Problem 5-17, using any computer software. Problem 5-17: Data collected on the yearly demand for 50-pound bags of fertilizer at Wallace Garden Supply are shown in the following table. Develop a 3-ye

> Use the data in Problem 4-22 and develop a regression model to predict selling price based on the square footage, number of bedrooms, and age. Use this to predict the selling price of a 10-year-old, 2,000-square-foot house with three bedrooms. Problem 4

> Refer to the Trowbridge Manufacturing example in Problem 2-35. The quality control inspection procedure is to select 6 items, and if there are 0 or 1 defective cases in the group of 6, the process is said to be in control. If the number of defects is mor

> Use the data in Problem 4-26 to develop a multiple linear regression model. How does this compare with each of the models in Problem 4-26? Problem 4-26: A sample of 20 automobiles was taken, and the miles per gallon (MPG), horsepower, and total weight w

> A sample of 20 automobiles was taken, and the miles per gallon (MPG), horsepower, and total weight were recorded. Develop a linear regression model to predict MPG, using horsepower as the only independent variable. Develop another model with weight as th

> Using computer software, find the least-squares regression line for the data in Problem 4-13. Based on the F test, is there a statistically significant relationship between the first test grade and the final average in the course? Problem 4-13: Students

> A couple of entrepreneurial business students at State University decided to put their education into practice by developing a tutoring company for business students. While private tutoring was offered, it was determined that group tutoring before tests

> Golden Age Retirement Planners specializes in providing financial advice for people planning for a comfortable retirement. The company offers seminars on the important topic of retirement planning. For a typical seminar, the room rental at a hotel is $1,

> Mysti Farris (see Problem 1-20) believes that there is a high probability that 120 pool cues can be sold if the selling price is appropriately set. What selling price would cause the break-even point to be 120? Problem 1-20: Farris Billiard Supply sell

> Mysti Farris (see Problem 1-20) is considering raising the selling price of each cue to $50 instead of $40. If this is done while the costs remain the same, what would the new break-even point be? What would the total revenue be at this break-even point?

> Farris Billiard Supply sells all types of billiard equipment and is considering manufacturing its own brand of pool cues. Mysti Farris, the production manager, is currently investigating the production of a standard house pool cue that should be very pop

> Katherine D’Ann, from Problem 1-18, has become concerned that sales may fall, as the team is on a terrible losing streak and attendance has fallen off. In fact, Katherine believes that she will sell only 500 programs for the next game. If it was possible

> Katherine D’Ann is planning to finance her college education by selling programs at the football games for State University. There is a fixed cost of $400 for printing these programs, and the variable cost is $3. There is also a $1,000 fee that is paid t

> Solve the following LP problem using the corner point graphical method. At the optimal solution, calculate the slack for each constraint: Maximize profit = 4X + 4Y subject to 3X + 5Y ≤ 150 X - 2Y ≤ 10 5X + 3Y ≤ 150 X,

> Use exponential smoothing with a smoothing constant of 0.3 to forecast the demand for fertilizer given in Problem 5-17. Assume that last period’s forecast for year 1 is 5,000 bags to begin the procedure. Would you prefer to use the expo

> In Problems 5-17 and 5-18, three different forecasts were developed for the demand for fertilizer. These three forecasts are a 3-year moving average, a weighted moving average, and a trend line. Which one would you use? Explain your answer. Problem 5-17

> Data collected on the yearly demand for 50-pound bags of fertilizer at Wallace Garden Supply are shown in the following table. Develop a 3-year moving average to forecast sales. Then estimate demand again with a weighted moving average in which sales in

> Using MAD, determine whether the forecast in Problem 5-15 or the forecast in the section concerning Wallace Garden Supply is more accurate. Problem 5-15: Develop a 4-month moving average forecast for Wallace Garden Supply, and compute the MAD. A 3-month

> Develop a 4-month moving average forecast for Wallace Garden Supply, and compute the MAD. A 3-month moving average forecast was developed in the section on moving averages in Table 5.2. Table 5.2: ΜΟΝΤΗ ACTUAL SHED SALES 3-MONTH MOVING AVERAGE Janu

> The closing stock price for each of two stocks was recorded over a 12-month period. The closing price for the Dow Jones Industrial Average (DJIA) was also recorded over this same time period. These values are shown in the following table: (a) Develop a

> The number of victories (W), earned run average (ERA), runs scored (R), batting average (AVG), and on-base percentage (OBP) for each team in the American League in the 2012 season are provided in the following table. The ERA is one measure of the effecti

> In 2012, the total payroll for the New York Yankees was almost $200 million, while the total payroll for the Oakland Athletics (a team known for using baseball analytics or saber metrics) was about $55 million, less than one-third of the Yankeesâ&#

> A sample of nine public universities and nine private universities was taken. The total cost for the year (including room and board) and the median SAT score (maximum total is 2400) at each school were recorded. It was felt that schools with higher media

> Use the data in Problem 4-26 to find the best quadratic regression model. (There is more than one to consider.) How does this compare to the models in Problems 4-26 and 4-27? Problem 4-26: A sample of 20 automobiles was taken, and the miles per gallon (

> Martin-Pullin Bicycle Corp. (MPBC), located in Dallas, is a wholesale distributor of bicycles and bicycle parts. Formed in 1981 by cousins Ray Martin and Jim Pullin, the firm’s primary retail outlets are located within a 400-mile radius

> The total expenses of a hospital are related to many factors. Two of these factors are the number of beds in the hospital and the number of admissions. Data were collected on 14 hospitals, as shown in the following table: Find the best regression model

> Use the data in Problem 4-22 and develop a regression model to predict selling price based on the square footage and number of bedrooms. Use this to predict the selling price of a 2,000-square-foot house with three bedrooms. Compare this model with the m

> The following data give the selling price, square footage, number of bedrooms, and age of houses that have sold in a neighborhood in the past 6 months. Develop three regression models to predict the selling price based upon each of the other factors indi

> The following data give the starting salary for students who recently graduated from a local university and accepted jobs soon after graduation. The starting salary, grade-point average (GPA), and major (business or other) are provided. (a) Using a com

> Use computer software to develop a regression model for the data in Problem 4-19. Explain what this output indicates about the usefulness of this model. Problem 4-19: Bus and subway ridership in Washington, D.C., during the summer months is believed to

> Bus and subway ridership in Washington, D.C., during the summer months is believed to be heavily tied to the number of tourists visiting the city. During the past 12 years, the following data have been obtained: (a) Plot these data and determine whethe

> Thirteen students entered the undergraduate business program at Rollins College 2 years ago. The following table indicates what their grade-point averages (GPAs) were after being in the program for 2 years and what each student scored on the SAT exam (ma

> Accountants at the firm Walker and Walker believed that several traveling executives submit unusually high travel vouchers when they return from business trips. The accountants took a sample of 200 vouchers submitted from the past year; they then develop

> Steve Caples, a real estate appraiser in Lake Charles, Louisiana, has developed a regression model to help appraise residential housing in the Lake Charles area. The model was developed using recently sold homes in a particular neighborhood. The price (Y

> Using the data in Problem 4-13, test to see if there is a statistically significant relationship between the grade on the first test and the final average at the 0.05 level of significance. Use the formulas in this chapter and Appendix D. Problem 4-13:

> For years The Glass Slipper restaurant has operated in a resort community near a popular ski area of New Mexico. The restaurant is busiest during the first 3 months of the year, when the ski slopes are crowded and tourists flock to the area. When James a

> Sue Reynolds has to decide if she should get information (at a cost of $20,000) to help her decide whether to invest in a retail store. If she gets the information, there is a 0.6 probability that the information will be favorable and a 0.4 probability t

> Mary is considering opening a new grocery store in town. She is evaluating three sites: downtown, the mall, and out at the busy traffic circle. Mary calculated the value of successful stores at these locations as follows: downtown, $250,000; the mall, $3

> In the past few years, the traffic problems in Lynn McKell’s hometown have gotten worse. Now, Broad Street is congested about half the time. The normal travel time to work for Lynn is only 15 minutes when Broad Street is used and there is no congestion.

> In this chapter, a decision tree was developed for John Thompson (see Figure 3.5 for the complete decision tree analysis). After completing the analysis, John was not completely sure that he is indifferent to risk. After going through a number of standar

> In Problem 3-37, you helped the medical professionals analyze their decision using expected monetary value as the decision criterion. This group has also assessed its utility for money: U(-$45,000) = 0, U(-$40,000) = 0.1, U(-$5,000) = 0.7, U($0)= 0.9, U(

> The Long Island Life Insurance Company sells a term life insurance policy. If the policy holder dies during the term of the policy, the company pays $100,000. If the person does not die, the company pays out nothing, and there is no further value to the

> Two states of nature exist for a particular situation: a good economy and a poor economy. An economic study may be performed to obtain more information about which of these will actually occur in the coming year. The study may forecast either a good econ

> A financial advisor has recommended two possible mutual funds for investment: Fund A and Fund B. The return that will be achieved by each of these depends on whether the economy is good, fair, or poor. A payoff table has been constructed to illustrate th

> Mark Martinko has been a class A racquetball player for the past 5 years, and one of his biggest goals is to own and operate a racquetball facility. Unfortunately, Mark thinks that the chance of a successful racquetball facility is only 30%. Mark’s lawye

> Peter Martin is going to help his brother who wants to open a food store. Peter initially believes that there is a 50–50 chance that his brother’s food store would be a success. Peter is considering doing a market research study. Based on historical data

> Southwestern University (SWU), a large state college in Stephenville, Texas, 30 miles southwest of the Dallas/Fort Worth metroplex, enrolls close to 20,000 students. In a typical town– gown relationship, the school is a dominant force i

> Bill Holliday is not sure what he should do. He can build a quadplex (i.e., a building with four apartments), build a duplex, gather additional information, or simply do nothing. If he gathers additional information, the results could be either favorable

> Jerry Smith (see Problem 3-38) has done some analysis about the profitability of the bicycle shop. If Jerry builds the large bicycle shop, he will earn $60,000 if the market is favorable, but he will lose $40,000 if the market is unfavorable. The small s

> The physicians in Problem 3-36 have been approached by a market research firm that offers to perform a study of the market at a fee of $5,000. The market researchers claim their experience enables them to use Bayes’ Theorem to make the following statemen

> Refer to the leasing decision facing Beverly Mills in Problem 3-31. Develop the opportunity loss table for this situation. Which option would be chosen based on the minimax regret criterion? Which alternative would result in the lowest expected opportuni