A randomly chosen subject arrives for a study of exercise and fitness. Describe a sample space for this case. You measure VO2, the maximum volume of oxygen consumed per minute during exercise. VO2 is generally between 2.5 and 6 liters per minute.

What is fitness in genetic terms?

Morrison Company uses a job-order costing system to assign manufacturing costs to jobs. Its balance sheet on January 1 is as follows:

Morrison Company Balance sheet January 1
Assets
Cash		$32,000
Raw materials	$ 9,000
Work in process	4,000
Finished goods	17,000	30,000
Prepaid expenses		2,000
Property, plant and equipment (net)		190,000
Total assets		$254,000
Liabilities and Stockholder's Equity
Accounts payable		$ 7,000
Retained earnings		$247,000
Total liabilities and stockholder's equity		$254,000

During January the company completed the following transactions:

7. Prepaid insurance expired during the month, $1,200 (80% related to production, and 20% related to selling and administration).

Required:

Calculate the ending balances that would be reported on the company's balance sheet on January 31. You can derive your answers using Microsoft Excel and Exhibit 3A-2 as your guide, or you can use paper, pencil, and a calculator. (Hint: Be sure to calculate the underapplied or overapplied overhead and then account for its affect on the balance sheet.)

What is Morrison Company's net operating income for the month of January?

Choose a person aged 19 to 25 years at random and ask, "In the past seven days, how many times did you go to an exercise or fitness center or work out?" Call the response Y for short. Based on a large sample survey, here is a probability model for the answer you will get. Show that this is a valid probability distribution.

$$\begin{array}{|l|c|c|c|c|c|c|c|c|} \hline \text { Days } & 0 & 1 & 2 & 3 & 4 & 5 & 6 & 7 \\ \hline \text { Probability } & 0.68 & 0.05 & 0.07 & 0.08 & 0.05 & 0.04 & 0.01 & 0.02 \\ \hline \end{array}$$

A company plans to open a new fitness center. It conducts a survey of the number of hours people exercise weekly. The results for twelve people chosen at random are 7,2,4,8,3,0,3,1,0,5,3, and 4 h What is the mode of the data?

See Table down below showing financial statement data and stock price data for Mydeco Corp.

a. In what year was Mydeco's net income the lowest?

b. In what year did Mydeco need to reduce its cash reserves?

c. Why did Mydeco need to reduce its cash reserves in a year when net income was reasonably high?

2012–2016 Financial Statement Data and Stock Price Data for Mydeco Corp

Mydeco Corp. 2012–2016 $\hspace{30mm}$ (All data as of fiscal year end; in $million)$

$$\begin{array}{lccccc} \text{Income statement} & 2012 & 2013 & 2014 & 2015 & 2016 \\ \text{Revenue} & 401.9 & 361.6 & 429.6 & 513.6 & 602.6 \\ \underline{\text{Cost of Goods Sold}} & (192.1) & (175.4) & (207.1) & (248.3) & (295.8)\\ \text{Gross Profit} & 209.8 & 186.2 & 222.5 & 265.3 & 306.8\\ \text{Sales and Marketing} & (65.0) & (64.4) & (84.3) & (104.9) & (121.1)\\ \text{Administration} & (61.8) & (57.1) & (59.0) & (66.9) & (79.8)\\ \underline{\text{Depreciation $\And$ Amortization}} & (27.5) & (26.3) & (32.5) & (38.3) & (40.1)\\ \text{EBIT} & 55.5 & 38.4 & 46.7 & 55.2 & 65.8\\ \underline{\text{Interest Income (Expense)}} & (32.4) & (31.8) & (32.0) & (37.0) & (40.9)\\ \text{Pretax Income} & 23.1 & 6.6 & 14.7 & 18.2 & 24.9\\ \underline{\text{Income Tax}} & (8.1) & (2.3) & (5.1) & (6.4) & (8.7)\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Shares outstanding (millions)} & 56.8 & 56.8 & 56.8 & 56.8 & 56.8\\ \text{Earnings per share} & \$0.26 & \$0.08 & \$0.17 & \$0.21 & \$0.29\\ \text{Balance Sheet} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Assets}\\ \text{Cash} & 49.4 & 68.0 & 91.7 & 80.4 & 83.6\\ \text{Accounts Receivable} & 87.6 & 70.6 & 69.3 & 77.4 & 84.2\\ \text{Inventory} & 33.5 & 32.2 & 27.3 & 30.2 & 35.8\\ \text{Total Current Assets} & 170.5 & 170.8 & 188.3 & 188.0 & 203.6\\ \text{Net Property, Plant $\And$ Equip.} & 244.3 & 243.3 & 306.1 & 349.6 & 347.9\\ \text{Goodwill $\And$ Intangibles} & 365.5 & 365.5 & 365.5 & 365.5 & 365.5\\ \text{Total Assets} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Liabilities $\And$ Stockholders’ Equity}\\ \text{Accounts Payable} & 18.8 & 18.8 & 22.4 & 27.1 & 30.3\\ \text{Accrued Compensation} & 7.6 & 6.3 & 7.5 & 7.7 & 9.4\\ \text{Total Current Liabilities} & 26.4 & 25.1 & 29.9 & 34.8 & 39.7\\ \text{Long-term Debt} & 498.9 & 498.9 & 572.2 & 597.5 & 597.5\\ \text{Total Liabilities} & 525.3 & 524 & 602.1 & 632.3 & 637.2\\ \text{Stockholders’ Equity} & 255.0 & 255.6 & 257.8 & 270.8 & 279.8\\ \text{Total Liabilities $\And$ Stockholders’ Equity} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Statement of Cash Flows} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Depreciation $\And$ Amortization} & 27.5 & 26.3 & 32.5 & 38.3 & 40.1\\ \text{Chg. in Accounts Receivable} & 3.9 & 17.0 & 1.3 & (8.1) & (6.8)\\ \text{Chg. in Inventory} & (2.9) & 1.3 & 4.9 & (2.9) & (5.6)\\ \underline{\text{Chg. in Payables $\And$ Accrued Comp.}} & 1.7 & (1.3) & 4.8 & 4.9 & 4.9\\ \text{Cash from Operations} & 45.2 & 47.6 & 53.1 & 44.0 & 48.8\\ \underline{\text{Capital Expenditures}} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Cash from Investing Activities} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Dividends Paid} & (5.2) & (5.2) & (5.2) & (5.2) & (5.6)\\ \text{Sale (or purchase) of stock} & — & — & — & — & —\\ \underline{\text{Debt Issuance (Pay Down)}} & — & — & 73.3 & 25.3 & —\\ \text{Cash from Financing Activities} & (5.2) & (5.2) & 68.1 & 20.1 & (5.6)\\ \text{Change in Cash} & 13.4 & 18.6 & 23.7 & (11.3) & 3.2\\ \text{Mydeco Stock Price} & \$7.02 & \$3.55 & \$5.86 & \$8.33 & \$11.57\\ \end{array}$$

$

There are 15 exercise bikes in a fitness store showroom. The fitness store owner wishes to select three of them to display at a fitness expo. How many ways can a group of three be selected?

See Table down below showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $\$ 12.3$ million at the end of $2013$, and this equipment was depreciated by $\$ 4.1$ million per year in $2014$, $2015$, and $2016$. Given Mydeco's tax rate of $35 \%$, what impact would this additional purchase have had on Mydeco's net income in years $2013-2016$? (Assume the equipment is paid for out of cash and that Mydeco earns no Vind interest on its cash balances.)

2012–2016 Financial Statement Data and Stock Price Data for Mydeco Corp

Mydeco Corp. 2012–2016 $\hspace{30mm}$ (All data as of fiscal year end; in $million)$

$$\begin{array}{lccccc} \text{Income statement} & 2012 & 2013 & 2014 & 2015 & 2016 \\ \text{Revenue} & 401.9 & 361.6 & 429.6 & 513.6 & 602.6 \\ \underline{\text{Cost of Goods Sold}} & (192.1) & (175.4) & (207.1) & (248.3) & (295.8)\\ \text{Gross Profit} & 209.8 & 186.2 & 222.5 & 265.3 & 306.8\\ \text{Sales and Marketing} & (65.0) & (64.4) & (84.3) & (104.9) & (121.1)\\ \text{Administration} & (61.8) & (57.1) & (59.0) & (66.9) & (79.8)\\ \underline{\text{Depreciation $\And$ Amortization}} & (27.5) & (26.3) & (32.5) & (38.3) & (40.1)\\ \text{EBIT} & 55.5 & 38.4 & 46.7 & 55.2 & 65.8\\ \underline{\text{Interest Income (Expense)}} & (32.4) & (31.8) & (32.0) & (37.0) & (40.9)\\ \text{Pretax Income} & 23.1 & 6.6 & 14.7 & 18.2 & 24.9\\ \underline{\text{Income Tax}} & (8.1) & (2.3) & (5.1) & (6.4) & (8.7)\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Shares outstanding (millions)} & 56.8 & 56.8 & 56.8 & 56.8 & 56.8\\ \text{Earnings per share} & \$0.26 & \$0.08 & \$0.17 & \$0.21 & \$0.29\\ \text{Balance Sheet} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Assets}\\ \text{Cash} & 49.4 & 68.0 & 91.7 & 80.4 & 83.6\\ \text{Accounts Receivable} & 87.6 & 70.6 & 69.3 & 77.4 & 84.2\\ \text{Inventory} & 33.5 & 32.2 & 27.3 & 30.2 & 35.8\\ \text{Total Current Assets} & 170.5 & 170.8 & 188.3 & 188.0 & 203.6\\ \text{Net Property, Plant $\And$ Equip.} & 244.3 & 243.3 & 306.1 & 349.6 & 347.9\\ \text{Goodwill $\And$ Intangibles} & 365.5 & 365.5 & 365.5 & 365.5 & 365.5\\ \text{Total Assets} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Liabilities $\And$ Stockholders’ Equity}\\ \text{Accounts Payable} & 18.8 & 18.8 & 22.4 & 27.1 & 30.3\\ \text{Accrued Compensation} & 7.6 & 6.3 & 7.5 & 7.7 & 9.4\\ \text{Total Current Liabilities} & 26.4 & 25.1 & 29.9 & 34.8 & 39.7\\ \text{Long-term Debt} & 498.9 & 498.9 & 572.2 & 597.5 & 597.5\\ \text{Total Liabilities} & 525.3 & 524 & 602.1 & 632.3 & 637.2\\ \text{Stockholders’ Equity} & 255.0 & 255.6 & 257.8 & 270.8 & 279.8\\ \text{Total Liabilities $\And$ Stockholders’ Equity} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Statement of Cash Flows} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Depreciation $\And$ Amortization} & 27.5 & 26.3 & 32.5 & 38.3 & 40.1\\ \text{Chg. in Accounts Receivable} & 3.9 & 17.0 & 1.3 & (8.1) & (6.8)\\ \text{Chg. in Inventory} & (2.9) & 1.3 & 4.9 & (2.9) & (5.6)\\ \underline{\text{Chg. in Payables $\And$ Accrued Comp.}} & 1.7 & (1.3) & 4.8 & 4.9 & 4.9\\ \text{Cash from Operations} & 45.2 & 47.6 & 53.1 & 44.0 & 48.8\\ \underline{\text{Capital Expenditures}} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Cash from Investing Activities} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Dividends Paid} & (5.2) & (5.2) & (5.2) & (5.2) & (5.6)\\ \text{Sale (or purchase) of stock} & — & — & — & — & —\\ \underline{\text{Debt Issuance (Pay Down)}} & — & — & 73.3 & 25.3 & —\\ \text{Cash from Financing Activities} & (5.2) & (5.2) & 68.1 & 20.1 & (5.6)\\ \text{Change in Cash} & 13.4 & 18.6 & 23.7 & (11.3) & 3.2\\ \text{Mydeco Stock Price} & \$7.02 & \$3.55 & \$5.86 & \$8.33 & \$11.57\\ \end{array}$$

$

To obtain a more accurate picture of the impact of air bags on preventing deaths, it is necessary to account for the effect of occupants using both seatbelts and air bags. If the occupants of the vehicles in which air bags are installed are more likely to be also wearing seat belts, then it is possible that some of the apparent effectiveness of the air bags is in fact due to the increased usage of seat belts. Thus, one more 2 2 table is necessary, the table displaying a comparison of proper seat belt usage for occupants with air bags available with those for occupants without air bags available. That data are given here. a. Is there significant evidence of an association between air bag installation and the proper usage of seat belts? Use $\alpha$ = .05 b. Provide justification for your results in part (a). REFERENCE: The authors also collected information about accidents concerning seat belt usage. The article compared fatality rates for occupants using seat belts properly with those for occupants not using seat belts. The data are given here. a. Calculate the odds of being killed in a harmful event car accident for a vehicle in which occupants were using seat belts and those who were not using seat belts. Interpret the two odds. b. Calculate the odds ratio of being killed in a harmful event car accident with and without seat belts being used properly. What does this ratio tell you about the importance of using seat belts? c. Is there significant evidence of a difference between vehicles with and without proper seat belt usage relative to the proportion of persons killed in a harmful event vehicle accident? Use $\alpha$ = .05. d. Place a 95% confidence interval on the odds ratio. Interpret this interval. 10.54 : The article “Who Wants Airbags” in Chance 18 (2005): 3–16 discusses whether air bags should be mandatory equipment in all new automobiles. Using data from the National Highway Traffic Safety Administration (NHTSA), they obtain the following information about fatalities and the usage of air bags and seat belts. All passenger cars sold in the U.S. starting in 1998 are required to have air bags. NHTSA estimates that air bags have saved 10,000 lives as of January 2004. The authors examined accidents in which there was a harmful event (personal or property), and from which at least one vehicle was towed. After some screening of the data, they obtained the following results. (The authors detail in their article the types of screening of the data that was done.) a. Calculate the odds of being killed in a harmful event car accident for a vehicle with and without air bags. Interpret the two odds. b. Calculate the odds ratio of being killed in a harmful event car accident with and without air bags. What does this ratio tell you about the importance of having air bags in a vehicle? c. Is there significant evidence of a difference between vehicles with and without air bags relative to the proportion of persons killed in a harmful event vehicle accident? Use $\alpha$ = .05. d. Place a 95% confidence interval on the odds ratio. Interpret this interval.

$$\begin{matrix} \text{ } & \text{Air Bag Installed Yes} & \text{Air Bag Installed No} & \text{Total}\\ \text{Killed} & \text{19,276} & \text{27,924} & \text{47,200}\\ \text{Survived} & \text{5,723,539} & \text{4,826,982} & \text{10,550,521}\\ \text{Total} & \text{5,742,815} & \text{4,854,906} & \text{10,597,721}\\ \end{matrix}$$

$$\begin{matrix} \text{ } & \text{Seat Belt Usage (Sealt Belt)} & \text{Seat Belt Usage (No Sealt Belt)} & \text{Total}\\ \text{Killed} & \text{16,001} & \text{31,199} & \text{47,200}\\ \text{Survived} & \text{7,758,634} & \text{2,791,887} & \text{10,550,521}\\ \text{Total} & \text{7,774,635} & \text{2,823,086} & \text{10,597,721}\\ \end{matrix}$$

$$\begin{matrix} \text{Air Bags} & \text{Seat Belt Usage (Sealt Belt)} & \text{Seat Belt Usage (No Sealt Belt)} & \text{Total}\\ \text{Yes} & \text{4,871,940} & \text{870,875} & \text{5,742,815}\\ \text{No} & \text{2,902,694} & \text{1,952,211} & \text{4,854,905}\\ \text{Total} & \text{7,774,634} & \text{2,823,086} & \text{10,597,720}\\ \end{matrix}$$

Refer to the data for AnimPix, Inc., in the prior exercises. In addition, the company has provided the following details concerning its activity rates:

	Activity Rates
	Animation Concept	Animation Production	Contract Administration
Technical staff salaries	$3,500	$5,000	$1,800
Animation equipment depreciation	600	1,500	0
Administrative wages and salaries	1,400	200	4,600
Supplies costs	300	600	100
Facility costs	200	400	100
Total	$6,000	$7,700	$6,600

Management has provided the following ease of adjustment codes for the various costs:

	Ease of Adjustment Code
Technical staff salaries	Red
Animation equipment depreciation	Red
Administrative wages and salaries	Yellow
Supplies costs	Green
Facility costs	Red

These codes created some controversy. In particular, some administrators objected to coding their own salaries Yellow, while the technical staff salaries were coded Red. However, the founders of the firm overruled these objections by pointing out that “our technical staff is our most valuable asset. Good animators are extremely diffi cult to fi nd, and they would be the last to go if we had to cut back.”

Required:

1. Using Exhibit 7A–3 as a guide, determine the cost of the local commercials market. (Think of the local commercials market as a product.)

2. Using Exhibit 7A–5 as a guide, prepare an action analysis report concerning the local commercials market. (This company has no direct materials or direct labor costs.)

3. What would you recommend to management concerning the local commercials market?

What are the differences between intercellular fluid, extracellular fluid, and interstitial fluid?

The following data are the monthly salaries y and the grade point averages x for students who obtained a bachelor’s degree in business administration.

GPA	Monthly Salary ($)
2.6	3600
3.4	3900
3.6	4300
3.2	3800
3.5	4200
2.9	3900

The estimated regression equation for these data is$ $$ \hat {y}$ = 2090.5 + 581.1x and MSE = 21,284. a. Develop a point estimate of the starting salary for a student with a GPA of 3.0. b. Develop a 95% confidence interval for the mean starting salary for all students with a 3.0 GPA. c. Develop a 95% prediction interval for Ryan Dailey, a student with a GPA of 3.0. d. Discuss the differences in your answers to parts (b) and (c ). $$

See Table down below showing financial statement data and stock price data for Mydeco Corp.

a. What is Mydeco's market capitalization at the end of each year?

b. What is Mydeco's market-to-book ratio at the end of each year? Windows.

c. What is Mydeco's enterprise value at the end of each year?

2012–2016 Financial Statement Data and Stock Price Data for Mydeco Corp

Mydeco Corp. 2012–2016 $\hspace{30mm}$ (All data as of fiscal year end; in $million)$

$$\begin{array}{lccccc} \text{Income statement} & 2012 & 2013 & 2014 & 2015 & 2016 \\ \text{Revenue} & 401.9 & 361.6 & 429.6 & 513.6 & 602.6 \\ \underline{\text{Cost of Goods Sold}} & (192.1) & (175.4) & (207.1) & (248.3) & (295.8)\\ \text{Gross Profit} & 209.8 & 186.2 & 222.5 & 265.3 & 306.8\\ \text{Sales and Marketing} & (65.0) & (64.4) & (84.3) & (104.9) & (121.1)\\ \text{Administration} & (61.8) & (57.1) & (59.0) & (66.9) & (79.8)\\ \underline{\text{Depreciation $\And$ Amortization}} & (27.5) & (26.3) & (32.5) & (38.3) & (40.1)\\ \text{EBIT} & 55.5 & 38.4 & 46.7 & 55.2 & 65.8\\ \underline{\text{Interest Income (Expense)}} & (32.4) & (31.8) & (32.0) & (37.0) & (40.9)\\ \text{Pretax Income} & 23.1 & 6.6 & 14.7 & 18.2 & 24.9\\ \underline{\text{Income Tax}} & (8.1) & (2.3) & (5.1) & (6.4) & (8.7)\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Shares outstanding (millions)} & 56.8 & 56.8 & 56.8 & 56.8 & 56.8\\ \text{Earnings per share} & \$0.26 & \$0.08 & \$0.17 & \$0.21 & \$0.29\\ \text{Balance Sheet} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Assets}\\ \text{Cash} & 49.4 & 68.0 & 91.7 & 80.4 & 83.6\\ \text{Accounts Receivable} & 87.6 & 70.6 & 69.3 & 77.4 & 84.2\\ \text{Inventory} & 33.5 & 32.2 & 27.3 & 30.2 & 35.8\\ \text{Total Current Assets} & 170.5 & 170.8 & 188.3 & 188.0 & 203.6\\ \text{Net Property, Plant $\And$ Equip.} & 244.3 & 243.3 & 306.1 & 349.6 & 347.9\\ \text{Goodwill $\And$ Intangibles} & 365.5 & 365.5 & 365.5 & 365.5 & 365.5\\ \text{Total Assets} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Liabilities $\And$ Stockholders’ Equity}\\ \text{Accounts Payable} & 18.8 & 18.8 & 22.4 & 27.1 & 30.3\\ \text{Accrued Compensation} & 7.6 & 6.3 & 7.5 & 7.7 & 9.4\\ \text{Total Current Liabilities} & 26.4 & 25.1 & 29.9 & 34.8 & 39.7\\ \text{Long-term Debt} & 498.9 & 498.9 & 572.2 & 597.5 & 597.5\\ \text{Total Liabilities} & 525.3 & 524 & 602.1 & 632.3 & 637.2\\ \text{Stockholders’ Equity} & 255.0 & 255.6 & 257.8 & 270.8 & 279.8\\ \text{Total Liabilities $\And$ Stockholders’ Equity} & 780.3 & 779.6 & 859.9 & 903.1 & 917.0\\ \text{Statement of Cash Flows} & 2012 & 2013 & 2014 & 2015 & 2016\\ \text{Net Income} & 15.0 & 4.3 & 9.6 & 11.8 & 16.2\\ \text{Depreciation $\And$ Amortization} & 27.5 & 26.3 & 32.5 & 38.3 & 40.1\\ \text{Chg. in Accounts Receivable} & 3.9 & 17.0 & 1.3 & (8.1) & (6.8)\\ \text{Chg. in Inventory} & (2.9) & 1.3 & 4.9 & (2.9) & (5.6)\\ \underline{\text{Chg. in Payables $\And$ Accrued Comp.}} & 1.7 & (1.3) & 4.8 & 4.9 & 4.9\\ \text{Cash from Operations} & 45.2 & 47.6 & 53.1 & 44.0 & 48.8\\ \underline{\text{Capital Expenditures}} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Cash from Investing Activities} & (26.6) & (23.8) & (97.5) & (75.4) & (40.0)\\ \text{Dividends Paid} & (5.2) & (5.2) & (5.2) & (5.2) & (5.6)\\ \text{Sale (or purchase) of stock} & — & — & — & — & —\\ \underline{\text{Debt Issuance (Pay Down)}} & — & — & 73.3 & 25.3 & —\\ \text{Cash from Financing Activities} & (5.2) & (5.2) & 68.1 & 20.1 & (5.6)\\ \text{Change in Cash} & 13.4 & 18.6 & 23.7 & (11.3) & 3.2\\ \text{Mydeco Stock Price} & \$7.02 & \$3.55 & \$5.86 & \$8.33 & \$11.57\\ \end{array}$$

$

Assume that you are planning to purchase an exercise and fitness center targeted to women aged 21 to 49 in your city. By doing market research using results from the Consumer Expenditure Surveys and the U.S. Census Bureau, you learn that 1,550 households in your target market spend $475 a year on fitness and recreation. There is one other fitness center that serves 25 percent of your target market. What would be your annual sales forecast for the center?