For the years ended December 31, 2006 and 2005, assume all sales are on credit and then compute the following: (a) collection period, (b) accounts receivable turnover, (c) inventory turnover, and (d ) days’ sales in inventory. Comment on the changes in the ratios from 2005 to 2006. 2006 2005 Sales . . . . . . . . . . . . . . . . . . . . . . $672,500 $530,000 Cost of goods sold . . . . . . . . . . . . $410,225 $344,500 Other operating expenses . . . . . . 208,550 133,980 Interest expense . . . . . . . . . . . . . 11,100 12,300 Income taxes . . . . . . . . . . . . . . . . 8,525 7,845 Total costs and expenses . . . . . . (638,400) (498,625) Net income . . . . . . . . . . . . . . . . . $ 34,100 $ 31,375 Earnings per share . . . . . . . . . . . .$ 2.10 $ 1.93

Suppose someone wants to sell a piece of land for cash. the selling of a piece of land represents turning

Ajustification for job training programs is that they improve worker productivity. suppose that you are asked to evaluate whether more job training makes workers more productive. however, rather than having data on individual workers, you have access to data on manufacturing firms in ohio. in particu- lar, for each firm, you have information on hours of job training per worker (training) and number of nondefective items produced per worker hour (output). (i) carefully state the ceteris paribus thought experiment underlying this policy question. (ii) does it seem likely that a firm’s decision to train its workers will be independent of worker characteristics? what are some of those measurable and unmeasurable worker characteristics? (iii) name a factor other than worker characteristics that can affect worker productivity. (iv) if you find a positive correlation between output and training, would you have convincingly established that job training makes workers more productive? explain.

Varto company has 9,400 units of its sole product in inventory that it produced last year at a cost of $23 each. this year’s model is superior to last year’s, and the 9,400 units cannot be sold at last year’s regular selling price of $42 each. varto has two alternatives for these items: (1) they can be sold to a wholesaler for $8 each, or (2) they can be reworked at a cost of $251,100 and then sold for $34 each. prepare an analysis to determine whether varto should sell the products as is or rework them and then sell them.