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UNIVERSITY OF TORONTO
Faculty of Arts & Science
APRIL 2020 EXAMINATIONS
IRE342H1S
Finance and Accounting for Industrial Relations and
Human Resource Professionals
Duration: Take–home to be submitted through
Quercus on or before April 9th, 2020,10:00 PM
Exam Reminders:
• In writing this exam, students must not share the exam with any other person or discuss the
exam in any other way. By submitting this exam, students represent that it is exclusively their own
written work, and that they have not consulted with anyone on any aspect of the exam.
• As a student, you alone are responsible for ensuring the integrity of your work and for
understanding what constitutes an academic offence. Failure to do so will be treated as an
allegation of academic misconduct and reported to the Student Integrity office for resolution. No
exceptions will be made.
• Late submissions will not be accepted (it will be treated the same way as if you had missed a
regular exam). Students who miss the submission deadline will be required to petition for special
consideration. Petitions will only be granted in cases of extenuating circumstances. Contact your
College Registrar’s office if you have missed this exam. Technical issues will not be accepted as
a reason for failing to submit the exam by the deadline.
Other Reminders:
• Prior to uploading your answers, ensure that you have numbered each page, p.1 of x, p.2 of x
• You must answer ALL questions and you must show ALL your work. The take–home exam
consists of 6 pages.
Exam Format and Grading Scheme:
Part 1: Calculation: 9 questions. 80 marks
Part 2: Communication: 3 questions. 15 marks
Part 1 Calculation (9 Questions; 80 marks total)
Answer the following independent questions:
QUESTION 1 (7 marks)
Jane Botosan operates a bed and breakfast hotel in a resort area near Lake Michigan. Depreciation on the
hotel is $60,000 per year. Jane employs a maintenance person at an annual salary of $41,000 and a
cleaning person at an annual salary of $24,000. Real estate taxes are $10,000 per year. The rooms rent at
an average price of $60 per person per night including breakfast. Other costs are laundry and cleaning
service at a cost of $10 per person per night and the cost of food which is $5 per person per night.
Instructions: Determine the number of rentals and the sales revenue Jane needs to break even using the
contribution margin technique. Show your work for full marks.
QUESTION 2 (3 marks)
Mercer has three product lines in its retail stores: books, videos, and music. Results of the fourth quarter
are presented below:
Books Music Videos Total
Units sold 1,000 2,000 2,000 5,000
Revenue $20,000 $40,000 $25,000 $85,000
Variable departmental costs 17,000 22,000 12,000 51,000
Direct fixed costs 1,000 3,000 2,000 6,000
Allocated fixed costs 7,000 7,000 7,000 21,000
Net income (loss) $ (5,000) $ 8,000 $ 4,000 $ 7,000
