Q&A Hero

Q: Sandpiper Corporation paid $120,000 for annual property taxes on January 15, 2011, and $20,000 for building repair costs on March 10, 2011. Total repair expenses for the year were estimated to be $200,000, and are normally accrued during the year until incurred. What total amount of expense for these items was reported in Sandpiper's first quarter 2011 interim income statement?A) $ 50,000B) $ 80,000C) $100,000D) $140,000

Q: The holding-period return on a stock was 25%. Its ending price was $18, and its beginning price was $16. Its cash dividend must have been _________. A. $.25 B. $1 C. $2 D. $4

Q: A problem with third-party financing of so much of health care is that A) it reduces the quality of health care received by most people. B) it discourages physicians from getting second opinions and running enough tests to be sure the right procedure is followed. C) it causes the demand for medical services to increase, which causes health care costs to increase. D) it discourages people from relying on the judgments of physicians in making decisions about health care.

Q: In general, GAAP encourages the identification of reportable segments based on the following:A) Reported segments must account for at least 75% of all external and inter-segment sales.B) Reported segments must ideally account for at least 75% of all sales, unless there are many smaller divisions and separate reporting would create less clarity in reporting.C) If there are more than 10 reportable segments, the company should consider additional aggregation of their segments.D) Reported segments must account for 100% of the external sales, but only 75% of external and inter-segment sales.

Q: Use the above table. If the marginal revenue product is $30, how many workers will the profit maximizing monopsonist hire and what wage will they pay each worker?A) 1; $10 B) 2; $15 C) 3; $20 D) 4; $25

Q: How does GAAP view interim accounting periods?A) As discrete units for which net income may be separately determinedB) As integral units of the entire year for which each interim period is an essential part of an annual periodC) As integral units of the entire year with each interim period as an independent accounting periodD) As discrete units of the entire year using the same principles that are applied to the annual period

Q: Jacana Company uses the LIFO inventory method. During the second quarter, Jacana experienced a 100-unit liquidation in its LIFO inventory at a LIFO cost of $430 per unit. Jacana considered the liquidation temporary and expects to replace the units in the third quarter at an estimated replacement cost of $460 a unit. The cost of goods sold computation in the interim report for the second quarter willA) include the 100 liquidated units at the $460 estimated replacement unit cost.B) include the 100 liquidated units at the $430 LIFO unit cost.C) be understated by $3,000.D) be overstated by $3,000.

Q: The following table is provided in the disclosures for interim reporting by Bigg Company, regarding the location of their assets.United States$1,860,000Mexico1,270,000Canada880,000Brazil440,000Other50,000Based on the table, which of the following statements is true?A) Only the U.S. and Mexico divisions would be reportable geographic divisions.B) The U.S., Mexico and Canada divisions would be reportable geographic divisions.C) All geographic divisions would be reportable, except for "other."D) All geographic divisions would be reportable.

Q: The United Auto Worker (UAW) would best be classified asA) a craft union.B) an industrial union. C) a guild.D) closed shop union. E) none of the above

Q: What is the purpose of interim reporting?A) Provide shareholders with more timely informationB) Provide shareholders with more accurate informationC) Provide shareholders with more extensive detail about specific accounts and transactionsD) Provide shareholders with more current audited information

Q: Aluminum cannot be produced without bauxite. Hence, the price elasticity of demand for bauxite by aluminum manufacturers will beA) perfectly elastic. B) elastic.C) inelastic. D) unitary elastic.

Q: Security A has a higher standard deviation of returns than security B. We would expect that: I. Security A would have a higher risk premium than security B. II. The likely range of returns for security A in any given year would be higher than the likely range of returns for security B. III. The Sharpe ratio of A will be higher than the Sharpe ratio of B. A. I only B. I and II only C. II and III only D. I, II, and III

Q: Which one of the following operating segment information items is not directly named by GAAP to be reconciled to consolidated totals?A) AssetsB) LiabilitiesC) RevenuesD) Profit or loss

Q: All of the following are exempt from antitrust laws EXCEPTA) labor unions. B) professional baseball.C) oil companies. D) public utilities.

Q: You purchased a share of stock for $29. One year later you received $2.25 as dividend and sold the share for $28. Your holding-period return was _________. A. -3.57% B. -3.45% C. 4.31% D. 8.03%

Q: Which one of the following operating segment disclosures is not required by GAAP?A) Total AssetsB) EquityC) Intersegment salesD) Extraordinary items

Q: Product differentiation always exists inA) perfect competition. B) monopolistic competition.C) oligopoly. D) monopoly.

Q: Consider a Treasury bill with a rate of return of 5% and the following risky securities: Security A: E(r) = .15; variance = .0400 Security B: E(r) = .10; variance = .0225 Security C: E(r) = .12; variance = .1000 Security D: E(r) = .13; variance = .0625 The investor must develop a complete portfolio by combining the risk-free asset with one of the securities mentioned above. The security the investor should choose as part of her complete portfolio to achieve the best CAL would be _________. A. security A B. security B C. security C D. security D

Q: Dott Corporation experienced a $100,000 extraordinary loss in the second quarter of 2011 in their East Coast operating segment. The loss should be recognizedA) only at the consolidated report level at the end of the year.B) entirely in the second quarter of 2011 in the East Coast operating segment.C) in equal amounts allocated to the remaining three quarters of 2011 at the corporate level.D) in equal amounts allocated to the remaining three quarters of 2011 of the East Coast segment.

Q: A portfolio with a 25% standard deviation generated a return of 15% last year when T-bills were paying 4.5%. This portfolio had a Sharpe ratio of ____. A. .22 B. .60 C. 42 D. .25

Q: As the definition of products narrows (i.e., becomes more specific), the concentration ratioA) is not valid.B) tends to decrease.C) tends to increase.D) does not change in any predictable manner.

Q: An enterprise has eight reporting segments. Five segments show an operating profit and three segments show an operating loss. In determining which segments are classified as reporting segments under the operating profits test, which of the following statements is correct?A) The test value for all segments is 10% of consolidated net profit.B) The test value for profitable segments is 10% or more of those segments reporting a profit, and the test value for loss segments is 10% or more of those segments reporting a loss.C) The test value for loss segments is 10% of the greater of (a) the absolute value of the sum of those segments reporting losses, or (b) 10% of consolidated net profit.D) The test value for all segments is 10% of the greater of (a) the absolute value of the sum of those segments reporting profits, or (b) the absolute value of the sum of those segments reporting losses.

Q: The formula is used to calculate the _____________.A. Sharpe ratioB. Treynor measureC. coefficient of variationD. real rate of return

Q: In the above figure, when this monopolistically competitive firm produces its profit-maximizing output, it sets a per-unit price ofA) $13. B) $11. C) $10. D) $8.

Q: For an operating segment to be considered a reporting segment under the revenue threshold, its reported revenue must be 10% or more ofA) the combined enterprise revenues, eliminating all relevant intracompany transfers and balances.B) the combined revenues, excluding intersegment revenues, of all operating segments.C) the combined revenues, including intersegment revenues, of all operating segments.D) the consolidated revenue of all operating segments.

Q: Historically, the best asset for the long-term investor wanting to fend off the threats of inflation and taxes while making his money grow has been____.A. stocksB. bondsC. money market fundsD. Treasury bills

Q: A firm that can determine the price-output combination in order to maximize profit is known as aA) price searcher. B) price taker. C) demand searcher. D) cost taker.

Q: Which of the following is not a quantitative threshold for determining a reportable segment?A) Segment assets are 10% or more of the combined assets of all operating segments.B) The absolute value of a segment's profit or loss is 10% or more of the greater of (1) the combined reported profit of all operating segments that reported a profit or (2) the absolute value of the combined reported loss of all operating segments that reported a loss.C) Segment reported revenue, including intersegment revenues, is 10% or more of the combined revenue (both internal and external) of all operating segments.D) Segment residual profit after the cost of equity is 10% or more of the combined residual profit of all operating segments.

Q: Two assets have the following expected returns and standard deviations when the risk-free rate is 5%: Asset A E(rA) = 10% σA = 20% Asset B E(rB) = 15% σB = 27% An investor with a risk aversion of A = 3 would find that _________________ on a risk-return basis. A. only asset A is acceptable B. only asset B is acceptable C. neither asset A nor asset B is acceptable D. both asset A and asset B are acceptable

Q: Price equals the minimum of long-run average costA) in a long-run equilibrium.B) in a short-run equilibrium as well as in a long-run equilibrium. C) whenever average revenue equals marginal cost.D) along a horizontal long-run supply curve, but not along an upward sloping long-run supply curve.

Q: Cole Company has the following 2011 financial data:Consolidated revenue per income statement $800,000Intersegment sales 200,000Intersegment transfers 100,000Combined revenues of all segments $1,100,000Cole Company should add segments ifA) the sum of its segments' external revenue does not exceed $600,000.B) the sum of its segments' external revenue does not exceed $825,000.C) the sum of its segments' revenue including intersegment revenue does not exceed $600,000.D) the sum of its segments' revenue including intersegment revenue does not exceed $825,000.

Q: Most studies indicate that investors' risk aversion is in the range _____. A. 1-3 B. 1.5-4 C. 3-5.2 D. 4-6

Q: The change in total revenues resulting from a change in output of one unit isA) average revenue. B) marginal revenue.C) quantity revenue. D) price revenue.

Q: What is the threshold for reporting a major customer?A) 5 percent of revenuesB) 5 percent of profitsC) 10 percent of revenuesD) 10 percent of profits

Q: In the mean standard deviation graph, the line that connects the risk-free rate and the optimal risky portfolio, P, is called the _________. A. capital allocation line B. indifference curve C. investor's utility line D. security market line

Q: OutputFixed CostsVariable CostsTotal CostsAverage Total CostsAverage Marginal Variable Costs Costs0 $0$100 1 30 2 50 3 60 4 120 5 200 In the above table, what is the average variable cost to produce 2 units of output?A) $30 B) $60 C) $55 D) $20

Q: GAAP requires disclosures for each reportable operating segment for each of the following, except forA) Revenues.B) Depreciation expense.C) R&D expenditures.D) Extraordinary items.

Q: Treasury bills are paying a 4% rate of return. A risk-averse investor with a risk aversion of A = 3 should invest entirely in a risky portfolio with a standard deviation of 24% only if the risky portfolio's expected return is at least ______. A. 8.67% B. 9.84% C. 21.28% D. 14.68%

Q: Which of the following would be a fixed input for an amusement park?A) Ticket takers B) Unpopped popcornC) Concession workers D) The roller coaster

Q: GAAP requires that segment information be reportedA) by geographics, without regard to size of the segment.B) by geographics, without regard to industry or product-line.C) however management organizes the enterprise into units for internal decision-making and performance-evaluation purposes.D) by industry or product-line, without regard to geographics.

Q: One method of forecasting the risk premium is to use the _______. A. coefficient of variation of analysts' earnings forecasts B. variations in the risk-free rate over time C. average historical excess returns for the asset under consideration D. average abnormal return on the index portfolio

Q: Normal rate of return is A) accounting profit. B) an explicit cost.C) economic profit.D) the amount that must be paid to obtain investment in a business.

Q: Which of the following conditions would not indicate that two business segments should be classified as a single operating segment?A) They have similar amounts of intersegment revenues or expenses.B) They have a similar distribution method for products.C) They have similar production processes.D) They have similar products or services.

Q: If you require a real growth in the purchasing power of your investment of 8%, and you expect the rate of inflation over the next year to be 3%, what is the lowest nominal return that you would be satisfied with? A. 3% B. 8% C. 11% D. 11.24%

Q: The budget constraint shows theA) combinations of goods that generate the same amount of total satisfaction.B) possible combinations of goods that can be purchased with a specified income.C) changes in consumption of goods that a consumer makes when his income increases.D) amount of a good the consumer will buy at various prices.

Q: 1) Similar operating segments may be combined if the segments have similar economic characteristics. Which one of the following is a similar economic characteristic under GAAP?A) The segments' management teamsB) The tax reporting law sectionsC) The distribution method for products or servicesD) The expected rates of return and risk for the segments' productive assets

Q: If you are promised a nominal return of 12% on a 1-year investment, and you expect the rate of inflation to be 3%, what real rate do you expect to earn? A. 5.48% B. 8.74% C. 9% D. 12%

Q: Diminishing marginal utility means that as more of a good is consumed, A) the rate at which total utility increases starts to diminish.B) the rate at which total utility increases stays the same.C) the rate at which total utility increases starts to increase.D) there is no impact on the rate of change of total utility.

Q: Each of the following accounts has been converted to U.S. dollars from a foreign subsidiary's financial statements. Based on the information given, determine if the U.S. dollar or a foreign currency is the functional currency of the subsidiary.F = Foreign CurrencyD = U.S. DollarN/A = Cannot be determinedCost of goods sold was converted at a historical rate ___________Marketable debt securities carried at cost were converted at the year-end spot rate ___________Depreciation Expense was converted at the historical rate at the date of acquisition of the subsidiary ___________Inventories carried at their historical cost were converted at the spot rate from year-end ___________Intangible assets were converted at the historical exchange rate at the date of acquisition of the subsidiary ___________Deferred income tax liability was converted at the year-end spot rate ___________Property, Plant and Equipment was converted at the year-end spot rate ___________Accounts Payable was converted at the year-end spot rate ___________Patents were converted at the exchange rate in place at the date of acquisition of the subsidiary ___________Accumulated depreciation on buildings was converted at the year-end spot rate ___________

Q: In calculating the variance of a portfolio's returns, squaring the deviations from the mean results in: I. Preventing the sum of the deviations from always equaling zero II. Exaggerating the effects of large positive and negative deviations III. A number for which the unit is percentage of returns A. I only B. I and II only C. I and III only D. I, II, and III

Q: Suppose the price of X increases by 20 percent while the quantity demanded of Y does not change. We would conclude thatA) the two goods are substitutes, but the cross elasticity of demand is not large.B) the two goods are complements, but the cross elasticity of demand is not large.C) the two goods are perfect substitutes. D) the two goods are not related.

Q: Pritt Company purchased all the outstanding stock of Standy Company (a manufacturing company in Argentina) when the book value of Standy's net assets equaled their fair value. Standy's summarized balance sheet is shown below on January 1, 2011, the date of acquisition, and on December 31, 2011, when the exchange rates were $.25 and $.20, respectively. The average exchange rate for 2011 was $.23, and Standy paid dividends in 2011 amounting to 300,000 pesos when the exchange rate was $.21. January 1, 2011 (Peso)December 31, 2011 (Peso)BALANCE SHEET Cash1,400,0001,100,000Accounts Receivable400,0001,400,000Inventory1,200,0001,200,000Building & Equipment1,000,0001,000,000Accumulated Depreciation(200,000)(300,000)Total Assets3,800,0004,400,000 Accounts Payable300,000360,000Debt Payable1,000,0001,000,000Common Stock2,000,0002,000,000Retained Earnings500,0001,040,000Total Liab. & Equity3,800,0004,400,000 Required: If Standy's functional currency and reporting currency are the Argentine peso, compute the change to other comprehensive income that would result from the translation of these financial statements at December 31, 2011.

Q: Historically, small-firm stocks have earned higher returns than large-firm stocks. When viewed in the context of an efficient market, this suggests that ___________. A. small firms are better run than large firms B. government subsidies available to small firms produce effects that are discernible in stock market statistics C. small firms are riskier than large firms D. small firms are not being accurately represented in the data

Q: PricePer Unit Quantity DemandedPer Week$10.00259.50309.00358.50408.00457.50507.00556.50606.00655.50705.0075Refer to the above table. What is the absolute price elasticity of demand when a price rises from $9 to $9.50?A) 0.35 B) 0.55 C) 2.57D) 2.85

Q: On January 1, 2011, Paste Unlimited, a U.S. company, acquired 100% of Sticky Corporation of Italy, paying an excess of 112,500 euros over the book value of Sticky's net assets. The excess was allocated to undervalued equipment with a five year remaining useful life. Sticky's functional currency is the euro, and the books are kept in euros. Exchange rates for the euro for 2011 are:January 1, 2011 $1.44Average rate for 2011 1.48December 31, 2011 1.52Required:1. Determine the depreciation expense on the excess allocated to equipment for 2011 in U.S. dollars.2. Determine the unamortized excess allocated to equipment on December 31, 2011 in U.S. dollars.3. If Sticky's functional currency was the U.S. dollar, what would be the depreciation expense on the excess allocated to the equipment for 2011?

Q: Historical returns have generally been __________ for stocks of small firms as (than) for stocks of large firms. A. the same B. lower C. higher D. none of these options (There is no evidence of a systematic relationship between returns on small-firm stocks and returns on large-firm stocks.)

Q: All the costs associated with making, reaching, and enforcing agreements are calledA) private costs. B) internal costs. C) transaction costs. D) social costs.

Q: On January 1, 2011, Placid Corporation acquired a 40% interest in Superior Industries, a Canadian Corporation, for $811,900 when Superior's stockholders' equity consisted of 1,000,000 Canadian dollars (C$) capital stock and C$500,000 retained earnings. Superior's functional currency is the Canadian dollar and the books are kept in the same currency. The exchange rate at the time of the purchase was $1.15 per Canadian dollar. Any excess allocated to patents is to be amortized over 10 years. A summary of changes in the stockholders' equity of Superior during 2011 and related exchange rates follows: Canadian $Exchange RateU.S. $Stockholders' equity - 1/1/111,500,000$1.15 C$1,725,000Net income300,000$1.14 A342,000Dividends(200,000)$1.14 C(228,000)Equity adjustment (31,000)Stockholders' equity - 12/31/111,600,000$1.13 C$1,808,000Required: Determine the following:1. Fair value of the patent from Placid's investment in Superior on January 1, 2011 in U.S. dollars2. Patent amortization for 2011 in U.S. dollars3. Unamortized patent at December 31, 2011 in U.S. dollars4. Equity adjustment from the patent in U.S. dollars5. Income from Superior for 2011 in U.S. dollars6. Investment in Superior balance at December 31, 2011 in U.S. dollars

Q: Both investors and gamblers take on risk. The difference between an investor and a gambler is that an investor _______. A. is normally risk neutral B. requires a risk premium to take on the risk C. knows he or she will not lose money D. knows the outcomes at the beginning of the holding period

Q: The impact of technological change in the health care area has been to A) reduce the quality of health care while raising the costs. B) reduce the cost of health care. C) increase the quality of health care while decreasing the costs. D) increase both the quality of health care and the costs of health care.

Q: During the 1926-2013 period which one of the following asset classes provided the lowest real return? A. Small U.S. stocks B. Large U.S. stocks C. Long-term U.S. Treasury bonds D. Equity world portfolio in U.S. dollars

Q: Par Industries, a U.S. Corporation, purchased Slice Company of New Zealand for $1,411,800 on January 1, 2011. Slice's functional currency is the New Zealand dollar (NZ$). Slice's books are kept in NZ$. The book values of Slice's assets and liabilities were equal to fair values, with the exception of land which was valued at NZ$1,300,000. Slice's balance sheet appears below:Current AssetsNZ$ 1,510,000Land645,000Buildings - net825,000Equipment - net220,000Total AssetsNZ$ 3,200,000 Current LiabilitiesNZ$ 1,200,000Long-Term Debt845,000Common Stock800,000Retained Earnings355,000 NZ$ 3,200,000Relevant exchange rates are shown below:January 1, 2011 1 NZ$ = $0.78Average rate 2011 1 NZ$ = $0.79December 31, 2011 1 NZ$ = $0.80Required:Determine the unrealized translation gain or loss at December 31, 2011 relating to the excess allocated to the undervalued land.

Q: Use the above table. If the marginal revenue product is $20, how many workers will the profit maximizing monopsonist hire?A) 1 B) 2 C) 3 D) 4

Q: During the 1986-2013 period, the Sharpe ratio was lowest for which of the following asset classes? A. small U.S. stocks B. large U.S. stocks C. long-term U.S. Treasury bonds D. equity world portfolio in U.S. dollars

Q: On January 1, 2011, Psalm Corporation purchased all the stock of Solomon Corporation for $481,400 when Solomon had capital stock of 180,000 pounds () and retained earnings of 90,000. The book value of Solomon's assets and liabilities represented the fair value, except for equipment with a 5-year life that was undervalued by 15,000. Any remaining excess is due to a patent with a useful life of 6 years. Solomon's functional currency is the pound. Solomon's books are kept in pounds. Relevant exchange rates for a pound follow:January 1, 2011 $1.66Average for 2011 1.65December 31, 2011 1.64Required:1. Determine the equity adjustment on translation of the excess differential assigned to equipment at December 31, 2011.2. Determine the equity adjustment on translation of the excess differential assigned to patent at December 31, 2011.

Q: A business enterprise in which employees must belong to the union before they can be hired isA) a closed shop. B) a union shop.C) a jurisdictional dispute. D) an industrial union.

Q: During the 1926-2013 period the Sharpe ratio was greatest for which of the following asset classes? A. small U.S. stocks B. large U.S. stocks C. long-term U.S. Treasury bonds D. bond world portfolio return in U.S. dollars

Q: Plato Corporation, a U.S. company, purchases all of the outstanding stock of Socrates Company, which operates outside the U.S. on January 1, 2011. Socrates' net assets have fair values that equal their book values with the exception of land that has a fair value of 200,000 foreign currency units and equipment with a fair value of 100,000 foreign currency units. Plato paid $180,000 for this acquisition. The balance sheets for Plato and Socrates are shown below just before the business combination. Socrates' functional currency is the foreign currency unit (fcu) and the exchange rate at the date of acquisition was $.40 per fcu. Socrates uses the fcu for record-keeping purposes. Plato ($)Socrates (fcu)Current Assets2,800,000200,000Land600,000150,000Buildings - net1,300,000200,000Equipment - net2,300,00050,000 Total Assets7,000,000600,000 Current Liabilities1,300,000150,000Notes Payable1,500,000100,000Capital Stock2,000,000200,000Retained Earnings2,200,000150,000 Total Liabilities7,000,000600,000 Required:Prepare a consolidated balance sheet for Plato and subsidiary at January 1, 2011 immediately following the business combination.

Q: The price elasticity of demand for a variable input will be greaterA) the fewer substitutes there are for the final product.B) the easier it is for a particular input to be substituted for by other inputs. C) the lower the price elasticity of supply of all other inputs.D) the smaller the proportion of total costs accounted for by a particular variable input.

Q: During the 1926-2013 period the geometric mean return on Treasury bonds was _________. A. 5.07% B. 5.56% C. 9.34% D. 11.43%

Q: Pew Corporation (a U.S. corporation) acquired all of the stock of Skunk Company (a Brazilian company) on January 1, 2011 for $9,300,000 when Skunk had 10,000,000 Brazilian real (BR) capital stock and 5,000,000 BR retained earnings. The book value of Skunk's net assets equaled the fair value on this date, and any cost/book value differential is due to a patent with a 5-year remaining useful life. Skunk's functional currency is the BR. Skunk's books are maintained in the functional currency. The exchange rates for BR's for 2011 are shown below:January 1, 2011 $0.60Average for 2011 $0.64December 31, 2011 $0.68Required:1. Calculate the patent value from the business combination on January 1, 2011 in U.S. dollars.2. Calculate the patent amortization in U.S. dollars for 2011.3. Prepare the journal entry (in U.S. dollars) required on Pew's books to record the patent amortization for 2011, assuming that Pew accounts for Skunk using the equity method.

Q: Which antitrust law is sometimes called the ʺChain Store Actʺ?A) Sherman Act B) Clayton ActC) Robinson-Patman Act D) Federal Trade Act

Q: During the 1926-2013 period the geometric mean return on small-firm stocks was ______. A. 5.31% B. 5.56% C. 9.34% D. 11.82%

Q: Puddle Incorporated purchased an 80% interest in Soake Company, located in England. Puddle paid $1,560,000 on January 1, 2011, at a time when the book values of Soake equaled the fair values. Any excess cost/book value differential was attributed to a patent with a five-year remaining useful life. Soake's books are kept in the functional currency, pounds. A summary of Soake's equity is shown below for the first year that Puddle had ownership interest. In PoundsExchange RatesIn DollarsStockholders' Equity - 12/31/101,200,000$1.60H$1,920,000Net Income400,000$1.62A648,000Dividends - 11/1/11(200,000)$1.64H(328,000)Translation Adjustment 70,000Stockholders' Equity - 12/31/111,400,000$1.65C$2,310,000Required:Determine Puddle's income from Soake for 2011, and the balance of Puddle's Investment in Soake account at December 31, 2011.

Q: In which market structure does a firm have the LEAST influence over the market price?A) Monopoly B) Monopolistic competitionC) Oligopoly D) Perfect competition

Q: Your investment has a 40% chance of earning a 15% rate of return, a 50% chance of earning a 10% rate of return, and a 10% chance of losing 3%. What is the standard deviation of this investment? A. 5.14% B. 7.59% C. 9.29% D. 8.43%

Q: Phim Inc., a U.S. company, owns 100% of Sera Corporation, a New Zealand company. Sera's equipment was acquired on the following dates (amounts are stated in New Zealand dollars as NZ$):Jan. 01, 2011 Purchased equipment for NZ$40,000Jul. 01, 2011 Purchased equipment for NZ$80,000Jan. 01, 2012 Purchased equipment for NZ$50,000Jul. 01, 2012 Sold equipment purchased on Jan. 01, 2011 for NZ$35,000Exchange rates for the New Zealand dollar on various dates are:Jan. 01, 2011 1NZ$ = $.800 Jan. 01, 2012 1NZ$ = $.830Jul. 01, 2011 1NZ$ = $.820 Jul. 01, 2012 1NZ$ = $.805Dec. 31, 2011 1NZ$ = $.830 Dec. 31, 2012 1NZ$ = $.7902011 avg. rate 1NZ$ = $.815 2012 avg. rate 1NZ$ = $.810Sera's equipment has an estimated 5-year life with no salvage value and is depreciated using the straight-line method. Sera's functional currency and reporting currency are the New Zealand dollar.Required:1. Determine the value of Sera's equipment account on December 31, 2012 in U.S. dollars.2. Determine Sera's depreciation expense for 2012 in U.S. dollars.3. Determine the gain or loss from the sale of equipment on July 1, 2012 in U.S. dollars.

Q: If industry sales are $2,000, and the top four firms have sales of $170, $140, $100, and $80, respectively, what will be the four-firm concentration ratio?A) 49 percent B) 24.5 percent C) 490 percent D) 200/49

Q: Plane Corporation, a U.S. company, owns 100% of Shipp Corporation, a Libyan company. Shipp's equipment was acquired on the following dates (amounts are stated in Libyan dinars):Jan. 01, 2011 Purchased equipment for 40,000 dinarsJul. 01, 2011 Purchased equipment for 80,000 dinarsJan. 01, 2012 Purchased equipment for 50,000 dinarsJul. 01, 2012 Sold equipment purchased on Jan. 01, 2011 for 35,000 dinarsExchange rates for the Libyan dinars on various dates are:Jan. 01, 2011 1 dinar = $.500 Jan. 01, 2012 1 dinar = $.530Jul. 01, 2011 1 dinar = $.520 Jul. 01, 2012 1 dinar = $.505Dec. 31, 2011 1 dinar = $.530 Dec. 31, 2012 1 dinar = $.4902011 avg. rate 1 dinar = $.515 2012 avg. rate 1 dinar = $.510Shipp's equipment has an estimated 5-year life with no salvage value and is depreciated using the straight-line method, calculating depreciation expense on a monthly basis. Shipp's functional currency is the U.S. dollar, but the company uses the Libyan dinar as its reporting currency.Required:1. Determine the value of Shipp's equipment account on December 31, 2012 in U.S. dollars.2. Determine Shipp's depreciation expense for 2012 in U.S. dollars.3. Determine the gain or loss from the sale of equipment on July 1, 2012 in U.S. dollars.

Q: In the above figure, the monopolistically competitive firmʹs profit -maximizing output isA) 1,000 units. B) 300 units. C) 900 units. D) 700 units.