Budgetary Performance, Rewards, Ethical Behavior Linda Ellis, division manager, is evaluated and rewarded on the basis of budgetary performance. Linda, her assistants, and the plant managers are all eligible to receive a bonus if actual divisional profits are between budgeted profits and 120 percent of budgeted profits. The bonuses are based on a fixed percentage of actual profits. Profits above 120 percent of budgeted profits earn a bonus at the 120 percent level (in other words, there is an upper limit on possible bonus payments). If the actual profits are less than budgeted profits, no bonuses are awarded. Consider the following actions taken by Linda:

a. Linda tends to overestimate expenses and underestimate revenues. This approach facilitates the ability of the division to attain budgeted profits. Linda believes that the action is justified because it increases the likelihood of receiving bonuses and helps to keep the morale of the managers high.

b. Suppose that toward the end of the fiscal year, Linda saw that the division would not achieve budgeted profits. Accordingly, she instructed the sales department to defer the closing of a number of sales agreements to the following fiscal year. She also decided to write off some inventory that was nearly worthless. Deferring revenues to next year and writing off the inventory in a no-bonus year increased the chances of a bonus for next year.

c. Assume that toward the end of the year, Linda saw that actual profits would likely exceed the 120 percent limit and that she took actions similar to those described in Item b.

Required:

1. Comment on the ethics of Linda’s behavior. Are her actions right or wrong? What role does the company play in encouraging her actions?

2. Suppose that you are the marketing manager for the division, and you receive instructions to defer the closing of sales until the next fiscal year. What would you do?

3. Suppose that you are a plant manager, and you know that your budget has been padded by the division manager. Further, suppose that the padding is common knowledge among the plant managers, who support it because it increases the ability to achieve the budget and receive a bonus. What would you do?

4. Suppose that you are the division controller, and you receive instructions from the division manager to accelerate the recognition of some expenses that legitimately belong to a future period. What would you do?

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Case study on married couples

6.3 Probit regression: A panel study followed 25 married couples over a period of five years. One item of interest is the relationship between divorce rates and the various characteristics of the couples. For example, the researchers would like to model the probability of divorce as a function of 238 Exercises age differential, recorded as the man’s age minus the woman’s age. The data can be found in the file divorce.dat. We will model these data with probit regression, in which a binary variable Yi is described in terms of an explanatory variable xi via the following latent variable model: Zi = ßxi + i Yi = d(c,8)(Zi), where ß and c are unknown coefficients, 1, . . . , n ~ i.i.d. normal(0, 1) and d(c,8)(z) = 1 if z > c and equals zero otherwise. a) Assuming ß ~ normal(0, t 2 ß ) obtain the full conditional distribution p(ß|y, x, z, c). b) Assuming c ~ normal(0, t 2 c ), show that p(c|y, x, z, ß) is a constrained normal density, i.e. proportional to a normal density but constrained to lie in an interval. Similarly, show that p(zi |y, x, z-i , ß, c) is proportional to a normal density but constrained to be either above c or below c, depending on yi . c) Letting t 2 ß = t 2 c = 16 , implement a Gibbs sampling scheme that approximates the joint posterior distribution of Z, ß, and c (a method for sampling from constrained normal distributions is outlined in Section 12.1.1). Run the Gibbs sampler long enough so that the effective sample sizes of all unknown parameters are greater than 1,000 (including the Zi ’s). Compute the autocorrelation function of the parameters and discuss the mixing of the Markov chain. d) Obtain a 95% posterior confidence interval for ß, as well as Pr(ß > 0|y, x).

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Description of the business process

Part 1 of the Final Project, due at the end of this unit, requires you to describe and draw a flowchart of the sales or purchasing process at your organization (or one of your choice). This documentation will provide the basis for Part 2 of the Final Project.

1. Begin with an introduction to your organization. Identify the type of organization (i.e., manufacturing or service). Detail briefly the products or services offered by your organization and the market niche and/or general clientele targeted/serviced.
2. Document the sales or purchasing process.
3. Create a table of the processes, objectives, inputs, and outputs associated with processing the business transactions for the sales or purchasing process.
4. As an appendix, develop a system flowchart of either the sales or purchasing process. Please follow the guidelines for drawing system flowcharts documented throughout your textbook.
5. Conclude with a description of the business process in narrative form, explaining the objectives, events, inputs, and outputs. Make sure to reference key points in the system flowchart.Place your order now for a similar paper and have exceptional work written by our team of experts to guarantee you A Results

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Jim’s Furniture Inc. manufactures furniture in NY. Jim’s uses job-order costing system and uses machine hours to allocate overhead costs. Estimated overhead for the year was $800,000 and estimated machine hours were 50,000 hours. Total machine hours used to the end of November were 45,000 hours. Total actual overhead to the end of November was $680,000. Raw materials inventory at the end of November was $400,000. Jim’s uses a first in first out basis for inventory and calculating COGS. Direct labor is paid $20 per hour in 2017. A summary of Jim’s finished goods inventory for the end of November (beginning of December) is shown below:

On Nov. 30th, 2017 Jim’s had the following jobs in work in process inventory:

Mike’s also had the following production information for the month of December 2017:

Note: All raw materials can be directly traced to a furniture.

Jim’s sold 1,300 chairs, 3,500 large tables, and 4,600 lounge chairs in December 2017.

In December 2017, total materials purchased were $200,000, supervisors’ salary was $18,000, and machine depreciation was $44,000. There was no other manufacturing overhead occurred in this month.

Required:

1. Determine the ending balance of the following accounts at the end of December to help Jim’s prepare for the 2017 annual financial statements. (Hint: calculate the predetermined overhead rate to allocate overhead.) Please round to nearest dollar.

2. Calculate the amount of under- or over – applied overhead for 2017.

3. Discuss whether Jim’s should use direct labor hours instead of machine hours to apply their overhead, considering the “criteria” for choosing a driver for overhead allocation.

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Production on highway safety products

Yorkston Corporation was formed in 1961. The company came into existence concurrent with the beginning of construction of super highways throughout the country. It seems the company’s founders had innovated a unique process of applying high-gloss luminescent paint to street signs, and these were in high demand for the new high-speed roadways.
The company has gone on to develop a full line of highway safety products. Yorkston is now in the process of building a company museum. Someone has dug up the first page from the company’s original general journal. This page will be on display in the museum. When you examine this page, you will note that the bookkeeper simply recorded the debits and credits, but included no descriptions.
Your job is to review the journal page and write a description for each transaction . These descriptions will be included on an explanatory diagram included in the display case. The diagram should also include some information that would allow a museum visitor to know what the document is and how it was used.

Case study on Profitability or Performance

The companies to be compared and analyzed are Home Depot & Lowe’s. Find the websites on the internet for the two companies and locate their latest annual reports.

Part I-Ratio Calculation:

We will analyze Home Depot & Lowe’s by calculating 4 ratios: Current Ratio; Profit Margin; Return on Assets and Debt to Equity. Templates for calculating and presenting the information are at the following link: HD – Lowes- Ratio Analysis Use the Industry comparison information at the top of page 215 for current ratio) in the text to make your assessment of Strong, Weak or Neutral.

Part II- Summary:

Briefly discuss whether or not Home Depot & Lowe’s can pay their debts (Liquidity), whether or not each are Profitable (Profitability or Performance), and finally whether each will likely continue to operate (Long Term Solvency). Explain which company would you invest in and why (you must choose one of the two). Use the format at the following link: Financial Analysis Project- Summary week 3

I can provide all necessary documents including the annual reports, and the links listed above.

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