At december 31, 2011, newman engineering’s liabilities include the following: 1. $10 million of 9% bonds were issued for $10 million on may 31, 1988. the bonds mature on may 31, 2022, but bondholders have the option of calling (demanding payment on) the bonds on may 31, 2012. however, the option to call is not expected to be exercised, given prevailing market conditions.2. $14 million of 8% notes are due on may 31, 2015. a debt covenant requires newman to maintain current assets at least equal to 175% of its current liabilities. on december 31, 2011, newman is in violation of this covenant. newman obtained a waiver from national city bank until june 2012, having convinced the bank that the company’s normal 2 to 1 ratio of current assets to current liabilities will be reestablished during the first half of 2012.3. $7 million of 11% bonds were issued for $7 million on august 31, 1978. the bonds mature on july 31, 2012. sufficient cash is expected to be available to retire the bonds at maturity. required: what portion of the debt can be reported as a noncurrent liability?

Suppose that the world price of steel is $100 a ton, india does not trade internationally, and the equilibrium price of steel in india is $60 a ton. suppose that india now begins to trade internationally. the price of steel in india the quantity of steel produced in india a. does not change; does not change b. falls; increases c. falls; decreases d. rises; decreases e. rises; increases the quantity of steel bought by india india steel. a. increases; exports b. decreases; imports c. decreases; exports d. does not change; neither imports nor exports e. increases; imports

In the supply-and-demand schedule shown above, at the lowest price of $50, producers supply music players and consumers demand music players.

Zachary company produces commercial gardening equipment. since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. the costs and cost drivers associated with the four overhead activity cost pools follow: activities unit level batch level product level facility level cost $ 64,800 $ 27,730 $ 15,000 $ 154,000 cost driver 2,400 labor hrs. 47 setups percentage of use 11,000 units production of 780 sets of cutting shears, one of the company’s 20 products, took 240 labor hours and 7 setups and consumed 15 percent of the product-sustaining activities. required: (a) had the company used labor hours as a company wide allocation base, how much overhead would it have allocated to the cutting shears? (b) how much overhead is allocated to the cutting shears using activity-based costing? (c) compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 780 units are produced. if direct product costs are $150 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? (d) assuming that activity-based costing provides a more accurate estimate of cost, indicate whether the cutting shears would be over- or underpriced if direct labor hours are used as an allocation base. explain how over-or undercosting can affect vaulker's profitability. (e) comment on the validity of using the allocated facility-level cost in the pricing decision. should other costs be considered in a cost- plus pricing decision? if so, which ones? what costs would you include if you were trying to decide whether to accept a special order?