On January 1, 2017, Moritz Company issued a five-year, $300,000, 6% bond that pays interest each...
On January 1, 2017, Moritz Company issued a five-year, $300,000, 6% bond that pays interest each January 1 and July 1. The market rate at the time of issuance was 7%. Assume that, on July 1, 2020, Moritz retired all of the bonds at 99. What gain or loss, if any, will Moritz recognize on the retirement of the bonds? (Round to the nearest dollar and choose the answer closest to your calculations).
$1,202 loss
$1,202 gain
$16,181 gain
None of the above
$16,181 loss
The price of zero-coupon bonds is
None of the above.
The present value of the principal payment at maturity
The present value of the principal payment at maturity less the present value of the interest payments.
The face value of the bond
The present value of the principal payment at maturity plus the present value of the interest payments.
Dorado Company is authorized to issue 1,000,000 shares of common stock. They issued 400,000 shares of $5 par value stock for $18 per share. They repurchased 100,000 shares at $20 per share and reissued 20,000 of the Treasury shares at $22 per share. Assuming no shares were retired, what is the number of shares outstanding?
300,000 shares
380,000 shares
900,000 shares
320,000 shares
Cannot be determined based on the information given
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On January 1, 2017, Moritz Company issued a five-year,
$300,000, 6% bond that pays interest each...
Dorado Company is authorized to issue 1,000,000 shares of common stock. They issued 400,000 shares of...
Dorado Company is authorized to issue 1,000,000 shares of common stock. They issued 400,000 shares of $5 par value stock for $18 per share. They repurchased 100,000 shares at $20 per share and reissued 20,000 of the Treasury shares at $22 per share. Assuming no shares were retired, what is the number of shares outstanding? a. 300,000 shares b. Cannot be determined based on the information given c. 900,000 shares d. 380,000 shares e. 320,000 shares
IV. Long Term Liabilities. On January 1, 2017, Dutch Co. issued five year, 6 % bonds...
IV. Long Term Liabilities. On January 1, 2017, Dutch Co. issued five year, 6 % bonds payable with a face value of $3,500,000 The bonds were issued at 96 and pay interest on January 1 and July 1. Dutch amortizes bond discount using the straight-line method. On December 31, 2019, Dutch retired the bonds early by purchasing them at a market price of 99. The company's fiscal year ends on December 31. Prepare the following journal entries and calculations: REQUIRED:...
7. A company issued 6-year, 8% bonds with a par value of $550,000. The market rate...
7. A company issued 6-year, 8% bonds with a par value of $550,000. The market rate when the bonds were issued was 7.5%. The company received $555,500 cash for the bonds. Using the straight-line method, the amount of recorded interest expense for the first semiannual interest period is: 8. A corporation issued 8% bonds with a par value of $1,010,000, receiving a $22,000 premium. On the interest date 5 years later, after the bond interest was paid and after 40%...
1.On january 1, 2019, ayayai issued 10-year, 300,000 face value, 6% bonds at par. Each 1,000...
1.On january 1, 2019, ayayai issued 10-year, 300,000 face value, 6% bonds at par. Each 1,000 bond is convertible into 30 shares of Ayayau $2 Par value common, stock. The company had 10,000 shares of common stock(and no preferred stock) outstanding throughout its life. None of the bonds have been converted as of the end of 2020. (Ignore tax effects) A.Prepare the journal entry Ayayai would have made on January 1, 2019, to record the issuance of the bonds. B.Ayayi's...
On January 1, 2019, Concord issued 10-year, $300,000 face value, 6% bonds at par. Each $1,000...
On January 1, 2019, Concord issued 10-year, $300,000 face value,
6% bonds at par. Each $1,000 bond is convertible into 30 shares of
Concord $2 par value common stock. The company has had 10,000
shares of common stock (and no preferred stock) outstanding
throughout its life. None of the bonds have been converted as of
the end of 2020. (Ignore all tax effects.)
a. Prepare the journal entry Concord would have made on January
1, 2019, to record the issuance...
On May 1, X1, John Co. issued a $300,000 7-year bond, with 6% interest and issued...
On May 1, X1, John Co. issued a $300,000 7-year bond, with 6% interest and issued at 104. Interest payment dates are June 30 and December 31. Bonds dated Dec 31, XO. 1) Entry to issue bonds 2) Entries on 6/30/X1 3) Entries on 12/31/X1 4) On 9/30/X4, all bonds are retired at 102
On January 1, 2017, Nash Company issued 10-year, $1,860,000 face value, 6% bonds, at par. Each $1,000 bond is convertib...
On January 1, 2017, Nash Company issued 10-year, $1,860,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 15 shares of Nash common stock. Nash's net income in 2017 was $302,000, and its tax rate was 40%. The company had 92,000 shares of common stock outstanding throughout 2017. None of the bonds were converted in 2017. (a) Compute diluted earnings per share for 2017. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share t...
On January 1, 2017, Pronghorn Company issued 10-year, $2,090,000 face value, 6% bonds, at par. Each $1,000 bond is conve...
On January 1, 2017, Pronghorn Company issued 10-year, $2,090,000
face value, 6% bonds, at par. Each $1,000 bond is convertible into
14 shares of Pronghorn common stock. Pronghorn’s net income in 2017
was $311,000, and its tax rate was 40%. The company had 101,000
shares of common stock outstanding throughout 2017. None of the
bonds were converted in 2017.
(a) Compute diluted earnings per share for 2017.
(Round answer to 2 decimal places, e.g.
$2.55.)
Diluted earnings per
share
$...
Jabieb corporation issued 3,000 convertible bonds on January 1, 2018. The bonds have a 3-year lif...
Jabieb corporation issued 3,000 convertible bonds on January 1, 2018. The bonds have a 3-year life and are issued at par with a face value of $1,000 per bond, giving total proceedings of $3,000,000. Interest is payable annually at 6%. Each bond is convertible into 200 ordinary shares (par value $1). The market rate of interest on similar non-convertible debt is 8% a) Compute the liability and equity component of the convertible bond on January 1, 2018. (5 marks) b)...
On January 1, 2019, Culver issued 10-year, $300,000 face value, 6% bonds at par. Each $1,000...
On January 1, 2019, Culver issued 10-year, $300,000 face value, 6% bonds at par. Each $1,000 bond is convertible into 30 shares of Culver $2 par value common stock. The company has had 10,000 shares of common stock (and no preferred stock) outstanding throughout its life. None of the bonds have been converted as of the end of 2020. (Ignore all tax effects.) (c) Assume that 75% of the holders of Culver's convertible bonds convert their bonds to stock on...
IV. Long Term Liabilities. On January 1, 2017, Dutch Co. issued five year, 6 % bonds payable with a face value of $3,500,000 The bonds were issued at 96 and pay interest on January 1 and July 1. Dutch amortizes bond discount using the straight-line method. On December 31, 2019, Dutch retired the bonds early by purchasing them at a market price of 99. The company's fiscal year ends on December 31. Prepare the following journal entries and calculations: REQUIRED:...
1.On january 1, 2019, ayayai issued 10-year, 300,000 face value, 6% bonds at par. Each 1,000 bond is convertible into 30 shares of Ayayau $2 Par value common, stock. The company had 10,000 shares of common stock(and no preferred stock) outstanding throughout its life. None of the bonds have been converted as of the end of 2020. (Ignore tax effects) A.Prepare the journal entry Ayayai would have made on January 1, 2019, to record the issuance of the bonds. B.Ayayi's...
On January 1, 2019, Concord issued 10-year, $300,000 face value,
6% bonds at par. Each $1,000 bond is convertible into 30 shares of
Concord $2 par value common stock. The company has had 10,000
shares of common stock (and no preferred stock) outstanding
throughout its life. None of the bonds have been converted as of
the end of 2020. (Ignore all tax effects.)
a. Prepare the journal entry Concord would have made on January
1, 2019, to record the issuance...
On May 1, X1, John Co. issued a $300,000 7-year bond, with 6% interest and issued at 104. Interest payment dates are June 30 and December 31. Bonds dated Dec 31, XO. 1) Entry to issue bonds 2) Entries on 6/30/X1 3) Entries on 12/31/X1 4) On 9/30/X4, all bonds are retired at 102
On January 1, 2017, Nash Company issued 10-year, $1,860,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 15 shares of Nash common stock. Nash's net income in 2017 was $302,000, and its tax rate was 40%. The company had 92,000 shares of common stock outstanding throughout 2017. None of the bonds were converted in 2017. (a) Compute diluted earnings per share for 2017. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share t...
On January 1, 2017, Pronghorn Company issued 10-year, $2,090,000
face value, 6% bonds, at par. Each $1,000 bond is convertible into
14 shares of Pronghorn common stock. Pronghorn’s net income in 2017
was $311,000, and its tax rate was 40%. The company had 101,000
shares of common stock outstanding throughout 2017. None of the
bonds were converted in 2017.
(a) Compute diluted earnings per share for 2017.
(Round answer to 2 decimal places, e.g.
$2.55.)
Diluted earnings per
share
$...
On January 1, 2019, Culver issued 10-year, $300,000 face value, 6% bonds at par. Each $1,000 bond is convertible into 30 shares of Culver $2 par value common stock. The company has had 10,000 shares of common stock (and no preferred stock) outstanding throughout its life. None of the bonds have been converted as of the end of 2020. (Ignore all tax effects.) (c) Assume that 75% of the holders of Culver's convertible bonds convert their bonds to stock on...
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