Jenny Cochran, a graduate of The University of Tennessee with 4 years of experience as an equities analyst, was recently brought in as assistant to the chairman of the board of Computron Industries, a manufacturer of computer components. During the previous year, Computron had doubled its plant capacity, opened new sales offices outside its home territory, and launched an expensive advertising campaign. Cochran was assigned to evaluate the impact of the changes. She began by gathering financial statements and other data. (Data Attached) What caused the decline in the ROIC? Was it due to operating profitability or capital utilization? Do you think Computron’s growth added value? What is Computron's EVA?  The cost of capital was 10% in both years. Assume that a corporation has $200,000 of taxable income from operations. What is the company's federal tax liability? Assume that you are in the 25% marginal tax bracket and that you have $50,000 to invest. You have narrowed your investment choices down to municipal bonds yielding 7% or equally risky corporate bonds with a yield of 10%. Which one should you choose and why? At what marginal tax rate would you be indifferent?

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Lou Reed is the primary accountant and 1 of 87 employees at The Velvet Underground, a company that manufactures professional grade recording equipment and mixing boards. By the end of their third year, 2017, TVU had already turned a $150,000 profit. At that time, Lou used analytics to estimate promising sales of a new device TVU planned to sell. Unfortunately, the new device did not live up to expected potential. At the end of the following year, 2018, Lou was tasked with using analytics to figure out why the device did not sell well, and how those sales might be improved. Fortunately, in 2019, sales of the device increased, along with all of the company's other products. Each time Lou utilized analytics, he had to access a number of different databases to find all the data he needed. Velvet Underground's sales revenue grew from $250,000 in 2018 to $1 million in 2019, prompting Lou to upgrade his QuickBooks software. Which of the following options best describes TVU's accounting…

Terry House, the controller for MicroTech Software Company, is responsible for preparing the company’s financial statements.  He learns that sales for the first quarter of the year have dropped so dramatically that the company is in danger of bankruptcy.  As a result, he applies for an accounting position with another software company that competes with MicroTech.  During his job interview, Terry is asked why he wants to leave MicroTech.  He replies truthfully, “The company’s sales are down another 10% this quarter.  I fear they will go out of business.”  At that time, MicroTech had not released its sales results to the public. Discuss the ethics of this situation.