financeThis case is based on an actual situation experienced by one of the authors. Gilead Construction, headquartered in Topeka, Kansas, built a motel in Kansas City. The construction foreman, Slim Pickins, hired the workers for the project. Pickins had his workers fill out the necessary tax forms and sent the employment documents to the home office. Work on the motel began on May 1 and ended in December. Each Thursday evening, Pickins filled out a time card that listed the hours worked by each employee during the five-day work-week ended at 5 p.m. on Thursday. Pickins faxed the time sheets to the home office, which prepared the payroll checks on Friday morning. Pickins drove to the home office after lunch on Friday, picked up the payroll checks, and returned to the construction site. At 5 p.m. on Friday, Pickins distributed the paychecks to the workers. a. Describe in detail the internal control weakness in this situation. Specify what negative result could occur because of the internal control weakness. b. Describe what you would do to correct the internal control weakness. financeBetween his freshman and sophomore years of college, Jack takes a job as ticket collector at a local movie theatre. Moviegoers purchase a ticket from a separate employee outside the theatre and then enter through a single set of doors. Jack takes half their ticket, and they proceed to the movie of their choice. Besides trying to earn enough money for college the next year, Jack loves to watch movies. One of the perks of working for the movie theatre is that all employees are allowed to watch one free movie per day. However, in the employee handbook it states that friends and family of employees are not allowed to watch free movies. In addition, employees must pay full price for all concession items. Soon after starting work at the theatre, Jack notices that most other employees regularly bring their friends and family to the movie without purchasing a ticket. When Jack stops them at the door to ask for their ticket, they say, "Jack, no one really follows that policy. Just be cool and let us in. You can do the same." Jack even notices that upper management does not follow the policy of no family and friends watching free movies. Furthermore, employees commonly bring their own cups to get free soft drinks an d their own containers to eat free popcorn. Jack considers whether he should also start bringing friends and family and enjoying the free popcorn and beverages. H e reasons, 11Why should I be the only one following the rules? If everyone else is doing it, including upper management, what harm would it be for me to do it too? After all, when you watch a movie you aren't really stealing anything, and popcorn and drinks cost hardly anything. Plus, I really need to save for college." Discuss the ethical dilemma Jack faces. What is the issue? Who are the parties involved? What factors should Jack consider in making his decision? financeHenna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Sales and costs for each product follow.
$$
\begin{matrix}
& \text{Product T} & \text{Product O}\\
\text{Sales}\ldots\ldots\ldots & \text{\$2,000,000} & \text{\$2,000,000}\\
\text{Variable costs}\ldots\ldots\ldots & \text{1,600,000} & \text{250,000}\\
\text{Contribution margin}\ldots\ldots\ldots & \text{400,000} & \text{1,750,000}\\
\text{Fixed costs}\ldots\ldots\ldots & \text{125,000} & \text{1,475,000}\\
\text{Income before taxes }\ldots\ldots\ldots & \text{275,000} & \text{275,000}\\
\text{Income taxes (32\\% rate)}\ldots\ldots\ldots & \text{88,000} & \text{88,000}\\
\text{Net income} \ldots\ldots\ldots & \text{\$ 187,000} & \text{\$ 187,000}\\
\end{matrix}
$$
1. Compute the break-even point in dollar sales for each product. (Round the answer to whole dollars.) 2. Assume that the company expects sales of each product to decline to 30,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement as just shown with columns for each of the two products (assume a 32% tax rate). Also, assume that any loss before taxes yields a 32% tax benefit. 3. Assume that the company expects sales of each product to increase to 60,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement shown with columns for each of the two products (assume a 32% tax rate). 4. If sales greatly decrease, which product would experience a greater loss? Explain. 5. Describe some factors that might have created the different cost structures for these two products. 10th EditionEugene F. Brigham, Joel Houston777 solutions

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