Solution to Case 01 Financial Analysis and Forecasting Growing Pains Questions 1. Since this is the first time Jim and Mason will be conducting a financial forecast for Oats’ R’ Us‚ how do you think they should proceed? Which approaches or models can they use? What are the assumptions necessary for utilizing each model? Jim and Mason should begin their planning with a reasonable sales forecast. The sales forecast ought to be based on clearly stated assumptions about future economic
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Chapter 04 Analyzing Investing Activities Multiple Choice Questions 1. Which of the following would rarely be classified as a current asset? A. Prepaid insurance B. Goodwill C. Marketable Securities D. Work-in-progress 2. Which of the following would not be classified as a current asset? A. Inventory B. Accounts payable C. Accounts receivable D. Prepaid expenses 3. An asset is considered to be liquid if: A. it is readily converted into a current asset. B. it is
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The Three Pigs II: Vengeance There were once three swine that lived in a house of astoundingly well constructed crimson brick. It held up to the tremendous typhoon of an immensely powerful and terribly malevolent wolf. The wolf‚ however‚ refused to admit his mortifying defeat at the hands of three hogs that he thought were akin to a dirt devouring earthworm in the bowels of the planet in comparison to his might. He was starving for vengeance. Six years after the wolf’s defeat‚ the three pigs slumbered
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Tutorial solutions 4 QUESTIONS 5. What is meant by a currency trading at a discount or at a premium in the forward market? Answer: The forward market involves contracting today for the future purchase or sale of foreign exchange. The forward price may be the same as the spot price‚ but usually it is higher (at a premium) or lower (at a discount) than the spot price. PROBLEMS 4. Restate the following one-‚ three-‚ and six-month outright forward European term bid-ask quotes in forward points. Spot
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sales forecast ought to be based on clearly stated assumptions about future economic conditions. Next‚ they should prepare pro forma financial statements by either assuming that the key items vary proportionately with sales or remain constant (as the case may be). Based on their asset utilization rate‚ they would be able to determine the asset requirements for growth. Some of the funds required to finance growth would be raised from spontaneous sources such as accounts payables and accruals and from
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Chapter 4: Constraints TRUE/FALSE 1. Constraints are rules used to enforce business rules‚ practices‚ and policies. ANS: T PTS: 1 REF: 91 2. Constraints are used to ensure the accuracy and integrity of the data contained in the database. ANS: T PTS: 1 REF: 91 3. A constraint can only be created as part of the CREATE TABLE command. ANS: F PTS: 1 REF: 93 4. A constraint name can consist of up to 10 characters. ANS: F PTS: 1 REF: 93 5. A primary key is usually given the abbreviation _pk
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Chapter 4 Process Costing Chapter 4 Process Costing Solutions to Questions 4-1 A process costing system should be used in situations where a homogeneous product is produced on a continuous basis. 4-2 Job-order and processing costing are similar in the following ways: 1. Job-order costing and process costing have the same basic purposes—to assign materials‚ labor‚ and overhead cost to products and to provide a mechanism for computing unit product costs. 2. Both systems use the same basic
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The new machine will be depreciated straight-line to zero over its five-year life. It will probably be worth about 140‚000 after five years. The old computer is being depreciated at a rate of 130‚000 per year. It will be completely written off in three years. If we do not replace it now‚ we will have to replace it in two years. We can sell it now for 230‚000; in two years it will probably be worth 90‚000. The new machine will save us 125‚000 per year in operating costs. The tax rate is 38% and the
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units/second = 24.83 toy--‐trucks per hour Q4.4. 12 tasks to 4 workers (a) (a) Capacity = 1 / 85 sec = 42.35 units per hour (b) Direct labor content = (70+55+85+60) sec = 270 sec/unit or 4.5 min/unit (c) Labor utilization = labor content / (labor content + total idle time) = 270 sec / (270 + 15 + 30+ 0 +25 sec) = 79.41% (d) Note that we are facing a machine paced line‚ thus the first unit will take 4*85 seconds top go through the empty system. Flow Time = 4 * 85 sec + 99 / (1 / 85 sec) = 8755 sec or 145.92
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Case 12-4 Wayside Inns‚ Inc. 1. Pro side: The proposed expansion appears to meet the firm’s stated expansion criteria; The existing inn is clearly operating at or near its practical capacity; The analysis is based on one year only‚ and it ignores the fact that the management and reservation fees stay within the overall firm. Con side: The ROI is projected to decrease with the investment; The turnover count might be grossly overstated. This depends on how these data are collected. The same person
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