Reference no: EM13566331
A company issues bonds dated January 1 with a par value of $300,000. The bonds mature in 5 years. The contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $312,177. The journal entry to record the issuance of the bond is: Question 19 options: Debit Cash $312,177; credit Discount on Bonds Payable $12,177; credit Bonds Payable $300,000. Debit Cash $300,000; debit Premium on Bonds Payable $12,177; credit Bonds Payable $312,177.
Debit Bonds Payable $300,000; debit Interest Expense $12,177; credit Cash $312,177. Debit Cash $312,177; credit Premium on Bonds Payable $12,177; credit Bonds Payable $300,000. Debit Cash $312,177; credit Bonds Payable $312,177. 2-A corporation issued 8% bonds with a par value of $1,000,000, receiving a $20,000 premium. On the interest date 5 years later, after the bond interest was paid and after 40% of the premium had been amortized, the corporation purchased the entire issue on the open market at 99 and retired it. The gain or loss on this retirement is: Question 20 options: $0. $10,000 gain. $10,000 loss. $22,000 gain. $22,000 loss. 3-A company issued 8%, 15-year bonds with a par value of $550,000.
The current market rate is 8%. The journal entry to record each semiannual interest payment is: Question 22 options: Debit Bond Interest Expense $22,000; credit Cash $22,000. Debit Bond Interest Expense $44,000; credit Cash $44,000. Debit Bond Interest Expense $36,667; credit Cash $36,667. Debit Bond Interest Expense $660,000; credit Cash $660,000. No entry is needed, since no interest is paid until the bond is due. 4-Vans purchased 40,000 shares of Skechs common stock for $232,000. This represents 40% of the outstanding stock. The entry to record the transaction includes a: Question 26 options: Debit to Long-Term Investments for $92,800. Debit to Long-Term Investments for $232,000. Credit to Long-Term Investments for $92,800. Debit to Long-Term Investments-HTM for $232,000. Debit to Short-Term Investment-AFS for $232,000. 5-On February 15, Seacroft buys 7,000 shares of Kebo common at $28.53 per share plus a brokerage fee of $400. The stock is classified as available-for-sale securities.
On March 15, Kebo declares a dividend of $1.15 per share payable to stockholders of record on April 15. Seacroft received the dividend on April 15 and ultimately sells half of the Kebo stock on November 17 of the current year for $29.30 per share less a brokerage fee of $250. The fair value of the remaining shares is $29.50 per share. The amount that Seacroft should report in the equity section of its year-end December 31 balance sheet for its investment in Kebo is: Question 27 options: $10,295. $8,050. $2,245. $3,195. $6,390.