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Certificate of Deposit
On May 31, 2014, Elmer Corp. purchased a 120-day, 9% certificate of deposit for $50,000. The CD was redeemed on September 28, 2014. Prepare the journal entries on Elmer's books to account for:
a. The purchase of the CD.
b. The accrual of interest adjustment for interest earned through June 30, the end of the com- pany's fiscal year.
c. The redemption of the CD. Assume 360 days in a year.
A company sells one model of an exercise bicycle which sells for $500 each and has a $300 per unit variable cost. The company has $80,000 of fixed costs per quarter. Observe the following contribution based income statement when the company sells 500..
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