Use This Fact Situation to Answer the Related Questions That

question 32

Multiple Choice

Use this fact situation to answer the related questions that follow. Edward and John own residential lots of land in Ontario that are beside each other.The previous owners of the lots wanted to save themselves the cost of surveys and put up a fence on what they thought was the lot line between the two properties.Edward bought his lot in 1961,and from that time on began to landscape a 3 metre wide strip beside the fence;erecting a rock wall 3 metres from the fence;planting trees,shrubs,and flowers;and constructing a small fountain between the wall and the fence.In 1986,John purchased his lot and had a survey done,which disclosed that the fence had been placed 3.3 metres inside his lot,so John proceeded to move the fence back to the lot line and in the process destroyed all of the landscaping that Edward had done.
Assuming that the property was in the land registry system,in this case

• A)Edward acquired ownership of the strip of land by adverse possession.
• B)Edward acquired possessory ownership of the strip of land by adverse possession.
• C)Edward is now the absolute owner of the strip of land.
• D)the strip of land has become part of Edward's land,and Edward can sue John for the damage caused to his landscaping.
• E)all of the above

Assess how changes in production and inventory levels affect gross profit and ending inventory valuation.

Understand the strategic implications of using different costing methods for internal decision making and external reporting.

Analyze the repercussions of adopting absorption or variable costing on a firm’s income statement and balance sheet.

Recognize the role of step-fixed costs and their implications on cost accounting and management decisions.

---

Definitions:

Initial Public Offering (IPO)

A company’s first equity issue made available to the public. Also an unseasoned new issue.

Publicly Traded

Refers to companies whose shares are bought and sold on public stock exchanges.

Venture Capitalists

Investors who provide capital to start-up companies and small businesses with perceived long-term growth potential.

Pension Funds

Pooled monetary contributions from different individuals or entities to invest in securities, designed to generate future retirement income for participants.