ACCT 322 Exam V1 – Intermediate Accounting II Solution$24.00 + Quantity - Add to cart Category: Accounting Tags: 0, 1, 31st, accounting, accounting, acct, bond, bonds, common, company, corporation, debt, december, dividend, exam, following, intermediate, iued, january, journal, march, market, outstanding, paid, payment, points, price, rate, record, share, shares, shortterm, solution, stock, value, year Description Reviews (0) Description INSTRUCTIONS: Please complete all the questions assigned and show all your work. You may either type up your responses or perform by hand and scan your answer sheets and submit via the dropbox. Total 100 Points) 1. On December 31st, 2012 Sarah Corporation has the following information:Preferred Stock 6%, $100 par (3,000 shares issued)$200,000Common Stock, $5 par value (20,000 shares issued) $100,000Additional Paid in Capital$225,000Retained Earnings$550,000Record the following journal entries:a. Paid the annual dividend per share to the preferred shareholder and a $4 dividend to the common stockholder (both in cash).b. Declared a 15% stock dividend on the outstanding common stock when the price was $12 per share.c. Prepare the stockholderâ€™s equity section as of year-end. Assume net income was $350,000 at year-end.(15 points) 2. On May 1, the corporation bought a vehicle for $75,000 by giving a down payment of $15,000 and financing the remaining amount. The company signed an8 percent interest -bearing note for three years. Interest is due every 6 months and principal is at maturity. Record the journal entries on May 1, the interest payment 6 months later and any journal entries needed on December 31st. (10 points) 3. Johnson Corporation had the following transactions during the year. Record the journal entries.a. On Jan 14 issues 30,000 shares of common stock for cash at $8 per share. The par value is $3 per shareb. On Mar 1, bought 5,000 shares of common stock at a price of $12 per share. (Par value of shares is $3).c. Purchased a building on July 15th in exchange for 4,500 shares of common stock. The building is valued at $120,000 and the shares have a par value of $2 per share.d. Sold on August 28, 2,000 of the 5,000 shares bought on March 1 at a price of $15 per share ($2 par value).e. Paid a 15% stock dividend to outstanding common shareholders on December 31st.Assume a $2 par value and that the market value of the shares is $14 per share. (20 points) 4. On March 1st, 2011 a company issued 3,000 of $100 bonds, each convertible into 4 shares of common stock at $6 par value. On December 31, the company converted the bonds into common stock when the unamortized discount was $40,000. Record the conversion of the stock. (5 points) 5. During 2011, Otter Corp. issued a 10 year $200,000, 8% convertible bond. Each bond is $1,000 and convertible into 100 shares of common stock. The company has net income of $1,750,000 and 20,000 shares outstanding. Assume tax rate is 35% and compute Diluted EPS. (10 points) 6. On March 1st, 2012 a company granted 5 employees the option to buy 1,000 common stock shares at $40 per share with a par value of $3 per share for one year. The fair value of the options (compensation) is $400,000 over a 1 year period. Prepare the journal entry to record the value of the compensation on December 31st, 2012 and on February 1st, 2013 when they are exercised. Market value of the shares at the exercise date was $50 per share. (10 points) 7. Robertson Co. has the following transactions during the year:On January 1st, beginning balance of 80,000 shares.On April 1st, Issued 10,000 shares for cash.On September 1st, issued a 20% stock dividendOn November 1st issued 30,000 shares for cash.Calculate the weighted-average number of shares outstanding at year-end. (10 points) 8. Johnson Co issued bonds on January 1, 2008. The face value of the bond is $1,200,000 and has a coupon rate of 11% per year. The market rate is 10% per year. Interest is paid semi-annually and it is a 6- year bond. a. Record the issuance of the bond on January 1st.b. Record the interest payment and amortization of bond/premium on July 31st, 2008 using the straight-line method.c. On July 31st, 2011, the company retired the bonds at a price of 104. Record the retirement of the bond.(10 points) 9. Peterson Corporation has $3,000,000 of short-term debt due March 3, 2014. On March 25th, 2014 the company issued 100,000 shares of common stock totaling $4,000,000 to pay off the short-term debt. What amount would be recorded at shortterm debt in 2014? (4 points) 10. Bonds with a par value of $900,000 were dated January 1st, 2012 and sold at 106 plus accrued interest on June 1st. The coupon rate is 12% payable annually and matures in 5 years. Using the effective interest rate method, record the following journal entries: a. Issuance of the bonds on June 1st, 2012b. Amortization of the premium/discount and payment of interest on December 31st, 2012.c. Retirement of bonds at a price of 102 on December 31st 2014. Reviews There are no reviews yet. Be the first to review “ACCT 322 Exam V1 – Intermediate Accounting II Solution” Cancel replyYour email address will not be published. Required fields are marked *Your rating Rate… Perfect Good Average Not that bad Very poor Your review *Name * Email * Related products Accounting acc 560!!!!!!!!!!!!!!!!!!!!!!!!! $1.00 Add to cart Accounting acc560!!!!!!!!!!!!!!!!!!!!!!!!!!1111 $1.00 Add to cart Accounting bus 320 connect homework 7 $32.00 Add to cart
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