Question: The First Amendment to the U.S.

> How can the concept of a composite unit be used to explain why an unfavorable total sales-mix variance of contribution margin occurs?

> Show how managers can gain insight into the causes of a sales-volume variance by subdividing the components of this variance.

> “Managers will always choose the alternative that maximizes operating income or minimizes costs in the decision model.” Do you agree? Why?

> How should a company decide on the number of cost pools it should use to allocate costs to divisions, channels, and customers?

> “A company should not allocate costs that are fixed in the short run to customers.” Do you agree? Explain briefly.

> Give two examples of a value-added cost and two examples of a non-value-added cost.

> Describe two alternative approaches to long-run pricing decisions.

> Define predatory pricing, dumping, and collusive pricing.

> What are three benefits of using a product life-cycle reporting format?

> Give two examples in which the difference in the costs of two products or services is much smaller than the difference in their prices.

> Joyce Brown has run Medical Maids, a specialty cleaning service for medical and dental offices, for the past 10 years. Her static budget and actual results for April 2017 are shown below. Joyce has one employee who has been with her for all 10 years that

> Emerald Statuary manufactures bust statues of famous historical figures. All statues are the same size. Each unit requires the same amount of resources. The following information is from the static budget for 2017: Expected production and salesâ&#1

> Tyva makes a very popular undyed cloth sandal in one style, but in Regular and Deluxe. The Regular sandals have cloth soles and the Deluxe sandals have cloth-covered wooden soles. Tyva is preparing its budget for June 2018 and has estimated sales based o

> How does an engineered cost differ from a discretionary cost?

> Apex Chemical Company currently operates three manufacturing plants in Colorado, Utah, and Arizona. Annual carbon emissions for these plants in the first quarter of 2018 are 125,000 metric tons per quarter (or 500,000 metric tons in 2018). Apex managemen

> Jayzee Company manufactures a variety of products in a variety of departments and evaluates departments and departmental managers by comparing actual cost and output relative to the budget. Departmental managers help create the budgets and usually provid

> Refer to the information in Problem 6-44. All purchases made in a given month are paid for in the following month, and direct material purchases make up all of the accounts payable balance and are reflected in the accounts payable balances at the beginni

> Hazlett, Inc., operates at capacity and makes plastic combs and hairbrushes. Although the combs and brushes are a matching set, they are sold individually and so the sales mix is not 1:1. Hazlett’s management is planning its annual budg

> Refer to the information in Problem 6-42. Budgeted balances at January 31, 2018 are as follows: Cash…………………â

> Skulas, Inc., manufactures and sells snowboards. Skulas manufactures a single model, the Pipex. In late 2017, Skulas’s management accountant gathered the following data to prepare budgets for January 2018: Skulas’s CE

> Refer to the information in Problem 6-40. Assume the following: Animal Gear (AG) does not make any sales on credit. AG sells only to the public and accepts cash and credit cards; 90% of its sales are to customers using credit cards, for which AG gets the

> Animal Gear Company makes two pet carriers, the Cat-allac and the Dog-eriffic. They are both made of plastic with metal doors, but the Cat-allac is smaller. Information for the two products for the month of April is given in the following tables: Input P

> Paula Beane owns a restaurant franchise that is part of a chain of “southern homestyle” restaurants. One of the chain’s popular breakfast items is biscuits and gravy. Central Warehouse makes and freezes the biscuit dough, which it then sells to the franc

> Smart Video Company is a manufacturer of videoconferencing products. Maintaining the videoconferencing equipment is an important area of customer satisfaction. A recent downturn in the computer industry has caused the videoconferencing equipment segment

> “A branch office or business segment that shows negative operating income should be shut down.” Do you agree? Explain briefly.

> The Chen Corporation manufactures and sells two products: Thingone and Thingtwo. In July 2016, Chen’s budget department gathered the following data to prepare budgets for 2017: The following direct materials are used in the two product

> US Apparel (USA) manufactures plain white and solid-colored T-shirts. Budgeted inputs include the following: Budgeted sales and selling price per unit are as follows: USA has the opportunity to switch from using the dye it currently uses to using an en

> Hale Specialties manufactures, among other things, woolen blankets for the athletic teams of the two local high schools. The company sews the blankets from fabric and sews on a logo patch purchased from the licensed logo store site. The teams are as foll

> Mountain Outfitters operates a large outdoor clothing and equipment store with three main product lines: clothing, equipment, and shoes. Mountain Outfitters operates at capacity and allocates selling, general, and administration (S, G & A) costs to e

> Plum Electronics, a division of Berry Corporation, manufactures two large-screen television models: The Mammoth, which has been produced since 2013 and sells for $990, and the Maximum, a newer model introduced in early 2015 that sells for $1,254. Based o

> Archer Pro manufactures two models of sport bows, Basic and Deluxe, using a combination of machining and hand finishing. Machine setup costs are driven by the number of setups. Indirect manufacturing labor costs increase with direct manufacturing labor c

> Zarson’s Netballs is a manufacturer of high-quality basketballs and volleyballs. Setup costs are driven by the number of setups. Equipment and maintenance costs increase with the number of machine-hours, and lease rent is paid per squar

> Crosstown Health Center runs two programs: drug addict rehabilitation and aftercare (counseling and support of patients after release from a mental hospital). The center’s budget for 2017 follows. Kim Yu, the director of the center, is

> Pastel Bags (PB) is a designer of high-quality backpacks and purses. Each design is made in small batches. Each spring, PB comes out with new designs for the backpack and for the purse. The company uses these designs for a year and then moves on to the n

> Pharmahelp, Inc., a distributor of special pharmaceutical products, operates at capacity and has three main market segments: a. General supermarket chains b. Drugstore chains c. Mom-and-pop single-store pharmacies Rick Flair, the new controller of Ph

> Describe three key components in doing a strategic analysis of operating income.

> “I’m going to focus on the customers of my business and leave cost-allocation issues to my accountant.” Do you agree with this comment by a division president? Explain.

> Under the doctrine of stare decisis, courts are obligated to follow the precedents established in their jurisdiction unless there is a compelling reason not to do so. Should U.S. courts continue to adhere to this common law principle, given that our gove

> What is the difference between remedies at law and remedies in equity?

> What is a precedent? When might a court depart from precedent?

> What is the common law tradition?

> Suppose that the California legislature passes a law that severely restricts carbon dioxide emissions of automobiles in that state. A group of automobile manufacturers files a suit against the state of California to prevent enforcement of the law. The au

> Apples & Oranges Corporation learns that a federal administrative agency is considering a rule that will have a negative impact on the firm’s ability to do business. Does the firm have any opportunity to express its opinion about the pending rule? Explai

> What benefits could wearers of Google Glass obtain from using facial recognition technology?

> Why are owner/operators of small businesses at a disadvantage relative to large corporations when they attempt to decipher complex regulations that apply to their businesses?

> Does the civil law system offer any advantages over the common law system, or vice versa? Explain.

> Why is the incidental use of a person’s likeness without his or her consent permitted?

> John’s company is involved in a lawsuit with a customer, Beth. John argues that for fifty years higher courts in that state have decided cases involving circumstances similar to his case in a way that indicates he can expect a ruling in his company’s fav

> Read through the subsection entitled “Decisions and Opinions” in the appendix following this chapter. 1. One group will explain the difference between a concurring opinion and a majority opinion. 2. Another group will outline the difference between a co

> Karen Goldberg’s husband was killed in a terrorist bombing in Israel. She filed a suit in a U.S. federal court against UBS AG, a Switzerland-based global financial services company. She claimed that UBS aided in her husband’s killing because it provided

> AOL, LLC, mistakenly made public the personal information of 650,000 of its members. The members filed a suit, alleging violations of California law. AOL asked the court to dismiss the suit on the basis of a “forum-selection” clause in its member agreeme

> After World War II ended in 1945, an international tribunal of judges convened at Nuremberg, Germany. The judges convicted several Nazi war criminals of “crimes against humanity.” Assuming that the Nazis who were convicted had not disobeyed any law of th

> Arthur Rabe is suing Xavier Sanchez for breaching a contract in which Sanchez promised to sell Rabe a Van Gogh painting for $150,000. 1. In this lawsuit, who is the plaintiff, and who is the defendant? 2. If Rabe wants Sanchez to perform the contract a

> A county court in Illinois is deciding a case involving an issue that has never been addressed before in that state’s courts. The Iowa Supreme Court, however, recently decided a case involving a very similar fact pattern. Is the Illinois court obligated

> Assume that you want to read the court’s entire opinion in the case of Baker v. Premo, 268 Or.App. 406, 342 P.3d 142 (2015). Read the section entitled “Finding Case Law” in the appendix that follows this chapter, and then explain specifically where you w

> What are four primary sources of law in the United States?

> What are some important differences between civil law and criminal law?

> Jonathan is a 35-year-old single taxpayer with adjusted gross income of $46,300. He uses the standard deduction and has no dependents. a. Calculate Jonathan’s taxable income. Please show your work. b. When you calculate Jonathan’s tax liability are yo

> Alicia (age 27) is a single, full-time college student. She earns $13,200 from a part time job and has taxable interest income of $1,450. Her itemized deductions are $845. Calculate Alicia’s taxable income for 2016.

> Ulysses and Penelope are married and file separate returns for 2016. Penelope itemizes her deductions on her return. Ulysses’ adjusted gross income was $17,400, his itemized deductions were $2,250, and he is entitled to one exemption. Calculate Ulysses’

> Diego, age 28, married Dolores, age 27, in 2016. Their salaries for the year amounted to $47,230 and they had interest income of $3,500. Diego and Dolores’ deductions for adjusted gross income amounted to $2,000, their itemized deductions were $11,800, a

> What is the formula for computing taxable income as summarized in the textbook?

> In 2016, Lou has a salary of $53,300 from her job. She also has interest income of $1,600 and dividend income of $400. Lou is single and has no dependents. During the year, Lou sold silver coins held as an investment for a $7,000 loss. Calculate the foll

> Leslie is a single taxpayer who is under age 65 and in good health. For 2016, she has a salary of $24,000 and itemized deductions of $1,000. Leslie is entitled to one exemption on her tax return. a. How much is Leslie’s adjusted gross income? b. What am

> 1. Arthur is 65 years old. He supports his father, who is 90 years old, blind, and has no income. For 2016, how many exemptions should Arthur claim on his tax return? a. 1 b. 2 c. 3 d. 4 e. 5 2. Taxpayers who are 65 or older get the benefit of: a. An ad

> 1. The current income tax system was: a. Designed solely to raise money to run the government b. Authorized by the founding fathers when the government was formed c. Not designed with social objectives in mind d. Initiated by the Sixteenth Amendment to t

> Rachel is single and has wages of $150,000 and dividend income of $90,000. She has no investment expenses. Calculate the amount of the 3.8 percent net investment income tax she must pay.

> Describe the difference between the standard deduction and itemized deductions. How should a taxpayer decide whether to take the standard deduction or claim itemized deductions?

> Marc’s brother, Phillip, who is a 20-year-old French citizen, lives in France for the full year. Marc supports Phillip while he attends college. Can Marc claim Phillip as a dependent? Why or why not?

> If Charles, a 16-year-old child model, earns $50,000 a year and is completely selfsupporting even though he lives with his parents, can his parents claim him as a dependent? Why or why not?

> What is the total dollar amount of personal and dependency exemptions which a married couple with one child and $80,000 of adjusted gross income would claim in 2016?

> Indicate, in each of the following situations, the number of exemptions the taxpayers are entitled to claim on their 2016 income tax returns. Number of Exemptions a. Donna, a 20-year-old single taxpayer, supports her mother, who lives in her own home. He

> Mary is single and supports her 30-year-old son who has income of $2,000 and lives in his own apartment. a. Can she claim him as a dependent? b. Can she claim head of household filing status? Why or why not?

> List each alternative filing status available to unmarried individual taxpayers and the circumstances under which the alternatives can be used.

> Jason and Mary are married taxpayers in 2016. They are both under age 65 and in good health. For this tax year, they have a total of $41,000 in wages and $700 in interest income. Jason and Mary’s deductions for adjusted gross income amount to $5,000 and

> Maggie is single and supports her 85-year-old parents who have no income and live in a home rented for them by Maggie. What is Maggie’s filing status and why?

> Jessica and Carl were married on July 1, 2016. What are their options for filing status for their 2016 taxes?

> Melissa and Aaron are married taxpayers with taxable income of $105,000. a. When you calculate their tax liability are you required to use the tax tables or the tax rate schedules, or does it matter? b. What is their 2016 tax liability?

> For each of the following cases, indicate the filing status for the taxpayer(s) for 2016 using the following legend: A – Single B – Married filing a joint return C – Married filing separate returns D – Head of household E – Qualifying widow(er) Case F

> Determine from the tax table in Appendix A, the amount of the income tax for each of the following taxpayers for 2016: Taxpayer(s) Filing Status Taxable Income Income Tax Allen Single $21,000 $______________ Boyd MFS 24,545 $__________

> For each of the following situations (none of the taxpayers claim dependents), indicate whether the taxpayer(s) is (are) required to file a tax return for 2016. Explain your answer. a. Helen is a single taxpayer with interest income in 2016 of $8,750. b.

> Nicoula is a server at a La Jolla restaurant. Nicoula received $1,200 in unreported tips during 2016 and owes Social Security and Medicare taxes on these tips. Her total income for the year, including the tips, is $4,300. Is Nicoula required to file an i

> Christine is a single 50-year-old taxpayer with no dependents. Her only income is $40,750 of wages. Calculate her taxable income and her tax liability. Please show your work.

> Frank, age 35, and Joyce, age 34, are married and file a joint income tax return for 2016. Their salaries for the year total $84,600 and they have taxable interest income of $3,900. They have no deductions for adjusted gross income. Their itemized deduct

> Jim (age 50) and Martha (age 49) are married with three dependent children. They file a joint return for 2016. Their income from salaries totals $49,500, and they received $10,125 in taxable interest, $5,000 in royalties, and $3,000 in other ordinary inc

> List three major purposes the tax system is meant to serve:

> Kross Company purchased a machine at a price of $100,000 by signing a note payable, which requires a single payment of $118,810 in 2 years. Assuming annual compounding of interest, what rate of interest is being paid on the loan?

> Using the appropriate interest table, compute the present values of the periodic amounts, shown below, due at the end of the designated periods. (a) $50,000 receivable at the end of each period for 8 periods compounded at 12%. (b) $50,000 payments to be

> Consider the loan in BE6-16. What payments must Zach Taylor make to settle the loan at the same interest rate but with the 6 payments beginning on the day the loan is signed? In BE6-16 Zach Taylor is settling a $20,000 loan due today by making 6 equal

> Zach Taylor is settling a $20,000 loan due today by making 6 equal annual payments of $4,727.53. Determine the interest rate on this loan, if the payments begin one year after the loan is signed.

> Adams Inc. will deposit $30,000 in a 12% fund at the end of each year for 8 years beginning December 31, 2012. What amount will be in the fund immediately after the last deposit?

> Amos Excavating Inc. is purchasing a bulldozer. The equipment has a price of $100,000. The manufacturer has offered a payment plan that would allow Amos to make 10 equal annual payments of $15,582, with the first payment due one year after the purchase.

> What would you pay for a $100,000 debenture bond that matures in 15 years and pays $10,000 a year in interest if you wanted to earn a yield of: (a) 8%? (b) 10%? (c) 12%?

> Using the appropriate interest table, answer each of the following questions. (Each case is independent of the others.) (a) What is the future value of $9,000 at the end of 5 periods at 8% compounded interest? (b) What is the present value of $9,000 due

> For each of the following cases, indicate (a) To what rate columns, and (b) To what number of periods you would refer in looking up the interest factor. 1. In a future value of 1 table: 2. In a present value of an annuity of 1 table: Annual Number

> Your client, Wyeth Leasing Company, is preparing a contract to lease a machine to Souvenirs Corporation for a period of 25 years. Wyeth has an investment cost of $421,087 in the machine, which has a useful life of 25 years and no salvage value at the end

> Chris Spear invested $15,000 today in a fund that earns 8% compounded annually. To what amount will the investment grow in 3 years? To what amount would the investment grow in 3 years if the fund earns 8% annual interest compounded semiannually?

> As the new staff person in your company’s treasury department, you have been asked to conduct research related to a proposed transfer of receivables. Your supervisor wants the authoritative sources for the following items that are discussed in the securi

> The Flatiron Pub provides catering services to local businesses. The following information was available for The Flatiron for the years ended December 31, 2011 and 2012. Flatiron management is preparing for a meeting with its bank concerning renewal of

> Occidental Petroleum Corporation reported the following information in a recent annual report. Notes to Consolidated Financial Statements Cash and Cash Equivalents. Cash equivalents consist of highly liquid investments. Cash equivalents totaled approxi