15. A stock is trading at $20 per share; and, does not pay a dividend. The annual rate of interest is 6%. What is the value of the one year prepaid forward?
13-35
Common transactions affecting stockholders equity accounts
13-35 LO 1 Identify common transactions affecting stockholders’ equity accounts.
13-39Identify fraud risks associated with debt obligations.
13-45 LO 6 What type of audit approach is typically planned for debt obligations? Why is this most often the most appropriate approach?
13-51 Review theAuditing in Practicefeature “SEC Focus on Debt Presentation and Disclosure” and identify potential audit problems related to presentation and disclosure of debt.
14-62Each of the following is an independent situation related to a contingency. Describe what the auditor should do in each case.
a. The lawyer refused to furnish the requested information.
b. The lawyer was unable to form an opinion on the probability or amount of a pending lawsuit, but the auditor believes that the amount could be material.
c. The client stated that it had not consulted lawyers during the
past year.
14-69
What are the inherent limitations in an auditor’s ability to detect material misstatements relating to the client’s compliance with laws and regulations?
14-77
The audit of GolfDay Company, a manufacturer of bicycle racks and golf carts, is almost finished. Krista Heiss is the most experienced auditor on this audit and is in charge of performing final analytical procedures. The company ships most of its products to a combination of distributors and retailers. The business in totally within the United States at the present time and is seasonal.
a. Why is it important that final analytical procedures be per-
formed by experienced auditors?
b. What are some analytical procedures that Heiss might perform?
c. How can these procedures be useful at this stage of the audit to help ensure audit quality?
15. Complete the following table: Ticket Prices, Attendance, and Revenue if the Demand Curve is P = $50-0.005 x Q $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 $40 16. If P = $50 – 0.005 × Q, a. what is the equation for marginal revenue? b. how many tickets will the team sell when it maximizes revenue? c. what will the price be when the team maximizes revenue? d. how much revenue will the team earn when it maximizes revenue? 17. What is the relationship between market size and win in North American pro sports? Answer this question using both deductive and inductive analysis.
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12Brown Protein Powder produces a dietary supplement. The standard cost of producing one unit is: Material (1.30 pounds × $2.30)$2.99 Labor (1.20 hours × $10.00)12.00 Overhead? Standard variable overhead is $8.00 per unit, and fixed annual overhead is $100,800. At the start of 2014, expected production was 25,200 units. During 2014, 30,000 units were produced. The following information, related to actual costs incurred in 2014, is available: 1.Purchased 40,000 pounds of material for $84,400. 2.Used 39,010 pounds of material. 3.Worked 32,455 labor hours costing $371,700. 4.Actual overhead incurred was $325,600. Compute the standard overhead rate per unit. (Round answer to 2 decimal places, e.g. 15.25.)
14O 2.5 O 4O 5 A 60 O 144 O 25 O 10O 5.6 O 12O P3.07c 9ed Find the equivalent resistance Rab and the power delivered by the source. Rab | |O(Ohms) P5,- Watts Check
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14. Mateo currently has nothing saved for his retirement, which will start in 6 years from today. Mateo wants to receive 68,500 dollars each year for 5 years during retirement. The first of these payments will be received in 6 years from today. Mateo can earn a return of 7.6 percent per year in his account. How much does Mateo need to save each year for 6 years to have exactly enough to meet his retirement goal if he makes his first contribution to savings in one year from today and all contributions are equal?
14 Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for $52,000. The equipment falls into the five-year category for MACRS depreciation and can currently be sold for $21,800. A new piece of equipment will cost $142,000. It also falls into the five-year category for MACRS depreciation. Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 12-12. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Cash Year Savings 159,000 51,000 49,000 47,000 44,000 33,000 The firm’s tax rate is 35 percent and the cost of capital is 9 percent. a. What is the book value of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) Book value b. What is the tax loss on the sale of the old equipment? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) Tax loss c. What is the tax benefit from the sale? (Do not round intermediate calculations and round your answer to the nearest whole dollar.) Tax benefit
13. When is the opportunity cost of holding money higher? A. When interest rates are high. B. When interest rates are low. C. When people hold less cash and more financial assets. D. When the money supply increases.
14-107 LO 6 Locate and read the article listed below and answer the following questions. Bruyneels,L., W. R. Knechel, and M. Willekens. 2013 Turnaround initiatives,and auditors going-concern judgements: Theory 32 (3) : 105-121.a. What is the issue being addressed in the paper?b. What are the findings of the paper?
c. Why is the paper important to auditors, and what are the implications of this paper for the auditing profession?d. Describe the research methodology used as a basis for the concludionse. Describe any limitations of the reseach.
13. Suppose the total-cost function for a firm is given by C-qwv a) Use Shephard’s lemma to compute the (constant output) demand functions for inputs l and k. b) Use your results from part (a) to calculate the underlying production function for q.
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