Question

29. Which of the following may be a current liability? A) Withheld Income Taxes B) Deposits Received from Customers C) Deferred Revenue D) All of these answers are correct. 30. Pember Corporation started business in 2012 by issuing 200,000 shares of $20 par common stock for $27 each. In 2017, 25,000 of these shares were purchased for $39 per share by Pember Corporation and held as treasury stock. On June 15, 2018, these 25,000 shares were exchanged for a piece of property that had an assessed value of $760,000. Pember's stock is actively traded and had a market price of $45 on June 15, 2018. The cost method is used to account for treasury stock. The amount of paid-in capital from treasury stock transactions resulting from the above events would be A) $750,000. B) $450,000. C) $215,000. D) $150,000. 31. On January 1, 2018, Huff Co. sold $5,000,000 of its 10% bonds for $4,426,480 to yield 12%. Interest is payable semiannually on January 1 and July 1. What amount should Huff report as interest expense for the six months ended June 30, 2018? A) $221,330 B) $250,000 C) $265,589 D) $300,000

Answer 1

29)All of these answers are Correct

30)Amount of Paid in Capital from Treasury Stock = (47 - 39) x 25,000

=150,000

31)Interest Expense = 4,426,480 x 6% = 265,589