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Exercise 7-1Recognizing accrued interest expense
Harveys Corporation borrowed $60,000 from the bank on November 1, 2014. The note had a 6 percent annual rate of interest and matured on April 30, 2015. Interest and principal were paid in cash on the maturity date.
What amount of interest expense was paid in cash in 2014?
What amount of interest expense was reported on the 2014 income statement?
What amount of total liabilities was reported on the December 31, 2014, balance sheet?
What total amount of cash was paid to the bank on April 30, 2015, for principal and interest?
What amount of interest expense was reported on the 2015 income statement?
Exercise 7-18Determining the amount of bond premiums and discounts
For each of the following situations, calculate the amount of bond discount or premium, if any:
Wolfe Co. issued $120,000 of 6 percent bonds at 101.
Riley, Inc., issued $80,000 of 10-year, 8 percent bonds at 98.
Rais, Inc., issued $200,000 of 15-year, 9 percent bonds at 102¼.
Beaux Co. issued $400,000 of 20-year, 8 percent bonds at 99¾.
Exercise 8-4Effect of issuing common stock on the balance sheet
Newly formed Electronics Services Corporation has 100,000 shares of $10 par common stock authorized. On March 1, 2014, Electronics Services issued 20,000 shares of the stock for $12 per share. On May 2 the company issued an additional 30,000 shares for $15 per share. Electronics Services was not affected by other events during 2014.
Record the transactions in a horizontal statements model like the following one. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Use NA to indicate that an element was not affected by the event.
Determine the amount Electronics Services would report for common stock on the December 31, 2014, balance sheet.
Determine the amount Electronics Services would report for paid-in capital in excess of par.
What is the total amount of capital contributed by the owners?
What amount of total assets would Electronics Services report on the December 31, 2014, balance sheet?
Exercise 9-12Ratio analysis
During 2014, Desny Corporation reported after-tax net income of $3,890,000. During the year, the number of shares of stock outstanding remained constant at 10,000 of $100 par, 9 percent preferred stock and 400,000 shares of common stock. The company’s total stockholders’ equity is $20,000,000 at December 31, 2014. Desny Corporation’s common stock was selling at $52 per share at the end of its fiscal year. All dividends for the year have been paid, including $4.80 per share to common stockholders.
Compute the following by rounding to two decimal points.
Earnings per share
Book value per share of common stock
exercise 9-11 accounts receivable turnover, inventory turnover and net margin
selected data from kumar company follow
compute the following and round the computations to two decimal points
a. the accounts receivable turnover for 2014
b. the inventory turnover for 2014
c. the net margin for 2013
Acc 200 week 5 exercise 7-1recognizing accrued interest