Exam03 - OEM Exam 3 Spring 2008 Name UFID Ltkh~-f 15 points...

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OEM Exam 3 Spring 2008 / UFID Name Ltkh~-f S~ 13KS- ~3OS r Answer all questions keeping in mind that points are allocated as follows: 1. 15 points 2. 12 points 3. 10 points 4. 4 points 5. 5 points 6. 10 points 7. 12 points 8. 20 points 9. 12 points
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1. 15 Points cXhl'~i+ f·3 Lizzie Industries recently issued $15 million of 10% coupon bonds, payable semiannually, which mature in 15 years. The bonds were sold for $13,909,935 to yield an 11 % annual rate. Use the table below to show the amortization of the discount, interest expense, and the carrying amount of the bonds over periods 0 to 4. <:- (J/ ...:J.S If) ( _M I t Interest '0 rt'ttI\IH:. .f Exoense o 2 3 4 2. 12 points On December 31 s t, 2006, Brantmeyer Plumbing issued $2,000,000 worth of 8-year~ro-coupo'!ybonds. The market interest rate was 8%. Use the financial statement effects template below to record the bond issue and Brantmeyer Plumbing's first two interest payments. Balance Sheet = < Income Statement " "'- Rev- Expen- _ Net enues - ses - Income Jt" Earned CaE-ital + Contrib. + CaE-ita I = = Cash + Noncash = Asset Assets Transaction Bond issue Interest 2007 Interest 2008 /rv
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3. 10 Points K2 Inc, manufactures equipment for individual and team sports including skiing, snowboarding and in- line skating. The company offers a one-year warranty on all products. During 2006, the company recorded net sales of $ 1,394.7 million. Historically, about 2% of all sales are returned under warranty and the cost of repairing and or replacing goods under warranty is about 50% of their retail value.
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This note was uploaded on 05/12/2010 for the course ACG 5065 taught by Professor Asare during the Spring '08 term at University of Florida.

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Exam03 - OEM Exam 3 Spring 2008 Name UFID Ltkh~-f 15 points...

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