Question

A company with 113,631 authorized shares of $5 par common stock issued 47,644 shares at $13 per share. Subsequently, the company declared a 2% stock dividend on a date when the market price was $28 a share. What is the amount transferred from the retained earnings account to paid-in capital accounts as a result of the stock dividend?

Select the correct answer.

$21,916

$26,681

$4,764

$63,633

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The Merchant Company issued 10-year bonds on January 1. The 10% bonds have a face value of $110,000 and pay interest every January 1 and July 1. The bonds were sold for $132,672 based on the market interest rate of 8%. Merchant uses the effective-interest method to amortize bond discounts and premiums. On July 1 of the first year, Merchant should record interest expense (round to the nearest dollar) of

Select the correct answer.

$6,634

$5,307

$4,400

$5,500

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Treasury stock which was purchased for $2,611 is sold for $3,252. Determine the result of these two transactions.

Select the correct answer.

stockholders' equity will be increased by $3,252

income will be increased by $641

stockholders' equity will not change

stockholders' equity will be increased by $641

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An employee receives an hourly wage rate of $15, with time and a half for all hours worked in excess of 40 hours during a week. Payroll data for the current week are as follows: hours worked, 48; federal income tax withheld, $353; social security tax rate, 6.0%; and Medicare tax rate, 1.5% on all earnings. What is the net amount to be paid to the employee?

Select the correct answer.

$368

$780

$1,022

$1,029

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An employee receives an hourly wage rate of $19, with time and a half for all hours worked in excess of 40 hours during a week. Payroll data for the current week are as follows: hours worked, 42; federal income tax withheld, $332; social security tax rate, 6.0%; and Medicare tax rate, 1.5% on all earnings. What is the gross pay for the employee?

Select the correct answer.

$798

$1,197

$1,596

$817

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Treasury stock that had been purchased for $4,715 last month was reissued this month for $5,311. What would the journal entry to record the reissuance include?

Select the correct answer.

Debit to Treasury Stock for $4,715

Credit to Excess of Par/Common for $596

Credit to Treasury Stock for $596

Credit to Treasury Stock for $4,715

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If $1,039,000 of 9% bonds are issued at 102 1/2, what is the amount of cash received from the sale?

Select the correct answer.

$779,250

$1,064,975

$1,039,000

$1,132,510

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During its first year of operations, a company granted employees vacation privileges and pension rights estimated at a cost of $25,318 and $13,600. The vacations are expected to be taken in the next year and the pension rights are expected to be paid in the future 5-30 years. What is the total cost of vacation pay and pension rights to be recognized in the first year?

Select the correct answer.

$13,600

$38,918

$66,118

$25,318

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On August 1, Batson Company issued a 60-day note with a face amount of $73,800 to Jergens Company for merchandise inventory. (Assume a 360-day year is used for interest calculations.)

a. Determine the proceeds of the note assuming the note carries an interest rate of 12%

b. Determine the proceeds of the note assuming the note is discounted at 12%.

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On June 8, Alton Co. issued an $60,600, 9%, 120-day note payable to Seller Co. Assume that the fiscal year of Seller Co. ends June 30. Using a 360-day year in your calculations, what is the amount of interest revenue recognized by Seller in the following year? When required, round your answer to the nearest dollar.

$5,454

$909

$1,485

$455

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Alliance Corp. issues 2,820 shares of $8 par value common stock at $16 per share. When the transaction is recorded, what credit entry or entries are made?

Select the correct answer.

Common Stock $22,560 and Paid-in Capital in Excess of Par Value $22,560.

Common Stock $22,560 and Retained Earnings $22,560.

Common Stock $22,560 and Paid-in Capital in Excess of Stated Value $22,560.

Common Stock $45,120.

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The Marx Company issued $88,000 of 8% bonds on April 1 of the current year at face value. The bonds pay interest semiannually on January 1 and July 1. The bonds are dated January 1, and mature in five years, on January 1. Determine the total interest expense related to these bonds for the current year ending on December 31.

Select the correct answer.

$7,040

$5,280

$3,520

$587

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When Bunyan Corporation was formed on January 1, the corporate charter provided for 108,100 shares of $14 par value common stock. The following transaction was among those engaged in by the corporation during its first month of operation: The corporation issued 8,980 shares of stock at a price of $21 per share.

Which of the following would be included when recording the transaction?

Select the correct answer.

credit to Common Stock for $188,580

debit to Cash for $125,720

credit to Paid-in Capital in Excess of Par for $62,860

debit to Common Stock for $108,100

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On January 1 of the current year, the Queen Corporation issued 11% bonds with a face value of $67,000. The bonds are sold for $64,990. The bonds pay interest semiannually on June 30 and December 31 and the maturity date is December 31, five years from now. Queen records straight-line amortization of the bond discount. Determine the bond interest expense for the year ended December 31.

Select the correct answer.

$2,010

$7,370

$614

$7,772

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Use the following tables to calculate the present value of a $51,800 to be received six years, if the market rate is 5% compounded annually? Round to the nearest whole number.

Periods	5%	6%	7%	10%
1	0.95238	0.94340	0.93458	0.90909
2	0.90703	0.89000	0.87344	0.82645
3	0.86384	0.83962	0.81630	0.75132
4	0.82270	0.79209	0.76290	0.68301
5	0.78353	0.74726	0.71299	0.62092
6	0.74622	0.70496	0.66634	0.56447
7	0.71068	0.66506	0.62275	0.51316
8	0.67684	0.62741	0.58201	0.46651
9	0.64461	0.59190	0.54393	0.42410
10	0.61391	0.55840	0.50835	0.38554

$

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Assuming no employees are subject to ceilings for their earnings, Moore Company has the following information for the pay period of December 15 - 31, 20xx. Use this information to answer the question that follow.

Gross payroll	$16,536.00		Federal income tax withheld	$2,581.00
Social security rate	6%		Federal unemployment tax rate	.8%
Medicare rate	1.5%		State unemployment tax rate	5.4%

Salaries Payable would be recorded for

Select the correct answer.

$11,689.57

$12,929.77

$12,714.80

$16,536.00

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Answer 1

1)correct option is "B" -26681

Transfer from retained earning to paid in capital =shares issued * % of stock dividend *market price

         47644*.02*28

             26681

2)correct option is "B" -5307

Interest expene = carrying value * market rate *6/12

              132672*.08*6/12

          = 5307

3)correct option is "D" -stockholders' equity will be increased by $641

equity will increase by 3252-2611=641

4)Gross earning : [48*15]+[(48-40)*15*1/2]

              720+ [8*15*1/2]

               720+ 60

                780

FICA :780 (.06+.015)

780*.075=58.5

net pay = 780-353-58.5= 368.5

COrrect option is "A" -368

correct option is " A"