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Finance
Jack Falcinelli is filing his tax as a head of household. His taxable income is $133,896 and his W-2 form shows he has already paid $34,197.00. Calculate his tax refund or payment?
Find the Federal income taxTaxable IncomeFilling Status$179,518.........................Single
Calculate the amount of tax owned by Erma Thornton Braddy if $182,817 and her filing status is single?
Compare Sections A, B, C, and D in Table 20-2 to determine which type of taxpayer that earns $112,000 would pay the most income tax. Which pays the least?
Using Section A from the 2011 Tax Computation Work Sheet, we see that the tax on $140,000 for a single person is $32,817. Compare this tax to the amount of tax required for a married person filing
Section A in Table 20-2 indicates that the maximum percent of income tax is 35% of the taxable income. Calculate the income tax for a single person whose taxable income is $400,000. Calculate the tax
Before purchasing investment property, an interested buyer can go to the tax assessor's office to find the taxes to be paid on the property. Using a computer provided for this purpose, the assessor
Complete the following balance sheet for Fawcett's Plumbing Supplies.
Find the operating ratio and the gross profit margin ratio for Molene Interent Store if the month's income statement shows net sales, $285,832; cost of goods sold, $198,530; gross profit, $87,302;
Buffalo Outback Outfitters is a public company with 37,360,000 shares of stock outstanding. As of the year's end the stock was selling for $26.18 per share, and had total net income of $51,710,000
Calculate the P/E ratio and the price to book ratio for Buffalo Outback Outfitters?
Complete the vertical analysis and horizontal analysis of the comparative balance sheet for Seymour's, LLC. Express percents to the nearest tenth of a percent?
Complete the following income statement and vertical analysis?
Complete the following horizontal analysis of a comparative income statement?
Complete the following balance sheet for Rooter Green Construction Company.
Find the gross profit margin ratio for the business in Exercise 10 to the nearest tenth of a percent?
Find the operating ratio and the gross profit margin ratio for Molene Internet Store if the month's income statement shows net sales, $285,832; cost of goods sold, $198,530; gross profit, $87,302;
Complete the vertical analysis and the horizontal analysis of the comparative balance sheet for Miller's Life Coaching. Express percents to the nearest tenth of a percent?
Complete the following income statement and vertical analysis. Express percents to the nearest tenth of a percent?
Complete the following horizontal analysis of a comparative income statement. Express percents to the nearest tenth of a percent?
Prepare a balance sheet for Miss Muffins' Bakery for December 31, 2014. The company assets are: cash, $1,985; accounts receivable, $4,219; merchandise inventory, $2,512. The liabilities are:
Complete the horizontal analyses showing differences in dollar amounts and percent increases (decreases) on the comparative balance sheet for O'Dell's Nursery.
Expand the balance sheet for Exercise 1 to include figures for 2013. The company assets are: cash, $1,762; accounts receivable, $3,785; merchandise inventory, $2,036. The liabilities are: accounts
Prepare the balance sheet for O'Dell's Nursery for December 31, 2014. The company assets are: cash, $8,917; accounts receivable, $7,521; merchandise inventory, $17,826. The liabilities are: accounts
Expand the balance sheet for Exercise 3 for 2013. The company assets are: cash, $12,842; accounts receivable, $5,836; merchandise inventory, $18,917. The liabilities are: accounts payable, $8,968;
Complete the portion for July 31, 2012, of the income statement shown for Miss Muffins' Bakery using the given information: gross sales, $32,596; returns and allowances, $296; cost of beginning
Use the information recorded for Miss Muffins' Bakery for month ending July 31, 2013, to extend the income statement for Exercise 2: gross sales, $35,403; returns and allowances, $342; cost of
Extend the income statement for Sitha Ros's Oriental Groceries to include a vertical analysis for 2013 and for 2014.
Extend the income statement for Miss Muffins' Bakery to include a vertical analysis for 2012 and 2013.
Extend the income statements for Sitha Ros's Oriental Groceries to include the amounts of increase or decrease and the percents of increase or decrease for a horizontal analysis?
Extend the income statement for Miss Muffins' Bakery to include the amounts of increase or decrease and the percents of increase or decrease for a horizontal analysis?
Use the data for Ancor international, Inc. to prepare a trend analysis of net sales, net income, and total assets. Excel should be used to prepare the analysis?
Blaw's Knifeworks, Inc. is a public company with 1,650,000 shares of stock outstanding. At year's end, the stock price was $23.17 per share and the company had total net income of $2,118,534. Total
Complete the horizontal analysis of the following comparative balance sheet. Express percents to the nearest tenth of a percent?
Houston Technology, Inc, is a public company with 2,350,000 shares of stock outstanding. As of the year's end the stock was selling for $9.83 per share and had total net income of $1,290,000 and
Houston Technology, Inc, is a public company with 2,350,000 shares of stock outstanding. As of the year's end the stock was selling for $9.83 per share and had total net income of $1,290,000 and
Complete the horizontal analysis of the following comparative income statement?
Find the operating ratio for Mile Wide for 2012 and 2013.
Find the gross profit margin ratio for Mile Wide for 2012 and 2013.
Use the formulas in the How to box: Prepare a Balance (p. 741) Sheet to explain the formula: Total current assets + total plant and equipment = total liabilities + total owner's equity?
Explain how the formula Gross profit = net sales - cost of goods sold can be rearranged to find net sales?
If you have the formula: Net profit = gross profit - operating expenses, and the net profit is $25,982 and operating expenses are $150,986, write an equation to find gross profit?
Explain how the formulaPercent of net sales = amount of item/net salesCan be rearranged to find the amount of the item?
Compare the formula is step 3 of the How To box: Prepare a horizontal Analysis of a Comparative Income Statement (p. 756) with the formula you would use to find the percent of sales tax if you know
How do the two formulas in Exercise 5 compare to the basic percent age formula P = RB?
Cedar-Crest Greeting Card Company ended the year 2012 with assets that totaled $120,000. The assets for 2013 increased to $580,000. What was the rate of growth for growth for Cedar-Crest?
Differentiate the following terms/concepts: a. Prospect and probability distribution b. Risk and uncertainty c. Utility function and expected utility d. Risk aversion, risk seeking, and risk
Consider a person with the following utility function over wealth: u(w) = ew, where e is the exponential function (approximately equal to 2.7183) and w = wealth in hundreds of thousands of dollars.
An individual has the following utility function: u(w) = w.5 where w = wealth. a. Using expected utility, order the following prospects in terms of preference, from the most to the least
Consider two prospects: Problem 1: Choose between Prospect A: $2,500 with probability .33, $2,400 with probability .66, Zero with probability .01. And Prospect B: $2,400 with certainty. Problem 2:
Differentiate the following terms/concepts: a. Systematic and nonsystematic risk b. Beta and standard deviation c. Direct and indirect agency costs d. Weak, semi-strong, and strong form market
A stock has a beta of 1.2 and the standard deviation of its returns is 25%. The market risk premium is 5% and the risk-free rate is 4%.a. What is the expected return for the stock?b. What are the
What is the joint hypothesis problem? Why is it important?
Warren Buffett has been a very successful investor. In 2008 Luisa Kroll reported that Buffett topped Forbes Magazine's list of the world's richest people with a fortune estimated to be worth $62
You are considering whether to invest in two stocks, Stock A and Stock B. Stock A has a beta of 1.15 and the standard deviation of its returns has been estimated to be 0.28. For Stock B, the beta
Differentiate the following terms/concepts: a. Lottery and insurance b. Segregation and integration c. Risk aversion and loss aversion d. Weighting function and event probability
According to prospect theory, which is preferred? a. Prospect A or B?b. Prospect C or D?c. Are these choices consistent with expected utility theory? Why or why not?
Consider a person with the following value function under prospect theory:v(w) = w.5 when w > 0= -2(-w) .5 when w < 0a. Is this individual loss-averse? Explain.b. Assume that this individual
Now consider a person with the following value function under prospect theory:v(z) = z.8 when z ¥ 0= -3(-z).8 when z This individual has the following weighting function:
Why might some prefer a prix fixe (fixed price) dinner costing about the same as an a la carte one (where you pay individually for each item)? (Assume the food is identical.)
Differentiate the following terms/concepts: a. Momentum and reversal b. Value and growth stocks c. Fundamental risk and noise-trader risk d. Carve-out and stub value
Refer back to the set of exchange rates in the "Support 3: There are no limits to arbitrage" section earlier in the chapter. Describe a profitable arbitrage strategy if x = 105.
Arbitrage is limited because the wealth of arbitrageurs is limited. Discuss this statement in the context of those who are managing their own money and those who are managing other people's money.
What is data snooping? What sort of empirical evidence is useful for obviating this critique?
What are the three supports on which market efficiency rests? Why is it that only one of them is required?
Differentiate the following terms/concepts:a. Primacy and recency effectsb. Salience and availabilityc. Fast-and-frugal heuristics and bias-generating heuristicsd. Autonomic and cognitive heuristics
Which description of Mary has higher probability?a. Mary loves to play tennis.b. Mary loves to play tennis and, during the summer, averages at least a game a week.Explain your answer. Define the
Rex is a smart fellow. He gets an A in a course 80% of the time. Still he likes his leisure, only studying for the final exam in half of the courses he takes. Nevertheless when he does study, he
Why are two people who witnessed the same event last month likely to describe it differently today?
How do gambling fallacy and clustering illusion relate to representativeness? Provide examples from sports. In what way are they different?
Differentiate the following terms/concepts:a. Miscalibration and excessive optimismb. Better-than-average effect and illusion of controlc. Self-attribution bias and confirmation biasd. Pros and cons
Is miscalibration greater for easy questions or hard questions? Is it greater when we look at 50% confidence ranges or 98% confidence ranges?
Provide an example where someone can be both excessively optimistic and miscalibrated at the same time.
Overconfidence does not quickly dissipate via learning because of the existence of contributing biases. Explain.
In 2007 the New England Patriots (an American football team) had a banner year winning all 16 regular season games. In these 16 games their points were: 38, 38, 38, 34, 34, 48, 49, 52, 24, 56, 31,
Differentiate the following terms/concepts/individuals:a. IQ and EQb. Mood and emotionc. Human brain and the brain of other animalsd. Phineas Gage and Elliot
Imagine you just won a lottery with a $10 million prize. What primary emotions might you feel? Describe their features, including the six used to define an emotion. Be sure to include observables.
Your colleague argues that emotion and reasoning are completely separate influences on decision-making. Do you agree? Discuss.
Differentiate the following terms/concepts:a. Good company and good stockb. Momentum-chaser and contrarianc. International diversification and domestic diversificationd. Anchoring and herding
In a regression of perceived long-term investment value (LTIV) on size (S), book to market (B/M), and management quality (MQ), the following coefficients (all significant) were estimated: LTIV = -.86
Home bias has a potential information-based explanation. Discuss.
In Canada there are two official languages, French and English. Some Canadian corporations are headquartered in Quebec where French is the official language. Most however are headquartered outside
Anchors are ubiquitous in financial markets. Give some examples.
Differentiate the following terms/concepts: a. Indirect and direct tests of relationship between overconfidence and trading activity b. Sensation seeking and overconfidence c. Under diversification
Consider two investors (A and B) with the following demand curves for a stock: A: p = 100 - q B: p = 150 - 2q a. At a price of $50, how much will A and B purchase? b. If the price falls to $30, who
Discuss what the evidence (using naturally-occurring data, survey data, and experimental data) suggests about the relationship among overconfidence, trading activity, and portfolio performance.
What evidence is there that people do not diversify enough? Why is it that this occurs? What is the simplest way to "buy" a high level of diversification in an equity portfolio?
Research indicates that stock market forecasters are also overconfident. Do they learn from their mistakes? Discuss.
Differentiate the following terms/concepts:a. Regret and disappointmentb. House money and break-even effectsc. Affect (noun) and affect (verb)d. Bad mood and depression
In housing markets, there is a positive correlation between prices and trading volume. When there is a housing boom, many houses sell at, or even above, the prices asked by sellers. In times of
This morning I woke up in a sour mood because my favorite team lost its game yesterday. Then I had to wait an extra long time in line for coffee. It started to rain and I forgot my umbrella in the
What does research based on the game show Deal or No Deal tell us about path-dependence and integration vs. segregation of gambles?
Differentiate the following terms/concepts: a. Dictator and ultimatum games b. Trust and reciprocity c. Conformity and groupthink d. Economic man and real people
Discuss the merits of the following statement: The evidence clearly indicates that proposers in dictator games care about fairness because they send responders more than they have to.
Differentiate the following terms/concepts: a. Obedience and loyalty b. Little white lies and cooperation c. Herding and social learning d. Outside director and independent board member
Your firm, which specializes in complex electronic products, has grown rapidly and you are now incorporating. Even after incorporation, a large percentage of the stock will be held by the founders,
Describe the three types of professional financial analysts and identify actual firms that employ each type.
a. Differentiate the following terms/concepts:a. Momentum and reversalb. Mean-reversion and continuation scenarios in BSV model c. Size factor and book-to-market factord. Risk-based and behavioral
In the context of the BSV model, explain intuitively (non technically) why two consecutive earnings changes in the same direction make investors less likely to think that they are in regime 1
In the chapter example of the DHS model, in one of the two cases even rational investors overreacted. This implies that overreaction is rational. Comment.
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