5. Assuming a December 31 fiscal year end, what is the appropriate treatment in a second quarter financial report for inventory that has market value below cost using the integral method ? a. A loss should be recorded in the second quarter in all cases b. A loss should be recorded in the second quarter if the market value is not expected to be at least equal to cost by year-end c. A loss should be recorded in the second quarter if the market value is expected to be at least equal to cost by year-end d. There is no loss to report in all cases e. There is a gain to report if the market value is not expected to be at least equal to cost by year end. 6. In 2018, Beta had an annual effective tax rate of 20%. In the 2019 first quarter, the company would pay tax at 25% just for that quarter alone. Beta management estimates that the 2019 full year effective tax rate will be 30%. Based on a first quarter 2019 income before tax of $200,000 what amount of provision for income taxes should be accrued under the integral method. a. $150,000 b. $60,000 c. $50,000 d. $40,000 e. $0 7. Pretzel acts as a sponsor in creating a special purpose entity (SPE) that will purchase Accounts Receivable from Pretzel. The SPE reports Assets (Accounts Receivable) of $10,000,000, Liabilities of $9,500,000 and Stockholders Equity of $500,000. The $500,000 of stockholders' equity comes from outside shareholders (not related to Pretzel). Which of the following can we say with certainty is true. a. The SPE is not a VIE (variable interest entity) b. The SPE is a VIE. c. Pretzel is the primary beneficiary and must consolidate the SPE d. Pretzel is not the primary beneficiary and does not consolidate the SPE e. None of the above is true