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NEW QUESTION: 1
Andrew Carson is an equity analyst employed at Lee, Vincent, and Associates, an investment research firm. In a conversation with his supervisor, Daniel Lau, Carson makes the following two statements about defined contribution plans.
Statement I: Employers often face onerous disclosure requirements.
Statement 2: Employers often bear all the investment risk.
Carson is responsible for following Samilski Enterprises (Samilski), a publicly traded firm that produces motorcycles and other mechanical parts. It operates exclusively in the United States. At the end of its 2009 fiscal year, Samilski's employee pension plan had a projected benefit obligation (PBO) of $320 million.
Also, unrecognized prior service costs were $35 million, the fair value of plan assets was $316 million, and the unrecognized actuarial gain was $21 million.
Carson believes the rate of compensation increase will be 5% as opposed to 4% in the previous year, and the discount rate will be 7% as opposed to 8% in the previous year.
This past year, Samilski began using special purpose entities (SPEs) for various reasons. In preparation for analyzing the SPE disclosures in the footnotes to the financial statements, Carson prepares a memo on SPEs. In the memo, he correctly concludes that the company will be required under new accounting rules to classify them as variable interest entities (VIE) and consolidate the entities on the balance sheet rather than report them using the equity method as in the past.
What are the likely effects of the required change in accounting for SPEs on Samilski's:
Return on assets? Return on equity?
A. Decrease ;No effect
B. Decrease ;Decrease
C. No effect ;Decrease
Answer: A
Explanation:
Explanation/Reference:
Explanation:
As a result of consolidating SPEs that were previously accounted for using the equity method, assets will increase but net income and equity won't change. Therefore, return on assets will decrease, but there will be no effect on return on equity. (Study Session 5, LOS 21. c)
NEW QUESTION: 2
A security engineer wants to add SSL to the public web server. Which of the following would be the FIRST step to implement the SSL certificate?
A. Encrypt the private key
B. Download the web certificate
C. Generate a CSR
D. Install the intermediate certificate
Answer: C
NEW QUESTION: 3
Refer to the exhibit.
AS #1 and AS #2 have multiple EBGP connectionn with each other. AS #1 wantn all return traffic that in dentined to the
prefix 10.10.10.1/32 to enter through the router R1 from AS #2. In order to achieve thin routing policy, the AS 1
advertinen a lower MED from R1, compared to a higher MED from R3, to their renpective BGP neighbor for the prefix
10.10.10.0/24. Will thin meanure guarantee that the routing policy in alwayn in effect?
A. Yen, becaune a lower MED in AS #2 in the highent BGP attribute in BGP bent-path route nelection.
B. Yen, becaune MED playn a determinintic role in return traffic engineering in BGP.
C. No, AS #2 can choone to alter the weight attribute in R2 for BGP neighbor R1, and thin weight value in cancaded
acronn AS #2 for BGP bent-path route nelection.
D. Yen, becaune a lower MED forcen BGP bent-path route nelection in AS #2 to choone R1 an the bent path for
10.10.10.0/24.
E. No, AS #2 can choone to alter the local preference attribute to overwrite the bent-path route nelection over the
lower MED advertinement from AS #1. Thin local preference attribute in cancaded acronn AS #2 for the BGP bent-path
route nelection.
Answer: E
Explanation:
MED and AS path prepending can both be uned to influence the way incoming traffic from other Autonomoun Syntemn
get nent to the local AS, but they provide no guarantee an the other AS ultimately han the final word in how they nend
traffic. Since local preference in preferred over MED in the BGP decinion procenn, the other AS can configure local
preference to override the MED nettingn you have configured.
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