ACC327_EX2_ReviewProblems

ACC327_EX2_ReviewProblems - -In 2010 Green Company issued,...

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
-In 2010 Green Company issued, at par, 75 $1,000, 8% bonds, each convertible into 100 shares of common stock. Green had revenues of $17,500 and expenses other than interest and taxes of $8,400 for 2011. (Assume that the tax rate is 40%) Throughout 2011, 2,000 shares of common stock were outstanding; none of the bonds was converted or redeemed. A) Compute diluted earnings per share for 2011.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
-Candy Construction Company agreed to a contract to build an apartment complex for $1,200,000. Information relating to costs and billings is as follows: 2010 2011 2012 Costs incurred to date 280,0 00 600,0 00 785,00 0 Estimated Costs yet to be incurred 520,0 00 200,0 00 0 Customer billings to date 150,0 00 500,0 00 1,200,0 00 Collection of billings to date 120,0 00 320,0 00 940,00 0
Background image of page 2
Assume the percentage of completion method is used. Compute the amount of gross profit to be recognized in 2010 and 2011. Prepare journal entries for 2011. Also record the entry if the completion method were to be used. On January 1, 2009, Washington Corporation purchased 12% bonds, having a maturity value of $500,000 for $537,907.40. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2009, and mature January 1, 2014, with interest receivable December 31 of each year. Washington Corporation uses the effective-interest method to allocate unamortized discount or premium. The bonds
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
are classified as available-for-sale. The fair value of the bonds at December 31 of each year-end is follows: 2009 - $534,200 2010 - $515,000 2011 - $513,000 2012 - $517,000 2013 - $500,000 A.) Prepare the journal entry at the date of the bond purchase. B.) Prepare the journal entries to record the interest received and recognition of fair value for 2009.
Background image of page 4
C.) Prepare the journal entry to record the recognition of fair value for 2010 -ABC Company has Bonds Payable Outstanding Shares in the amount of $400,000, and the premium on the Bonds Payable account has a balance of $6,000. Each $1,000 bond is convertible into 20 shares of preferred stock of par value of $50 per share. All bonds are converted into preferred stock. Assume the book value method is used, what is the entry?
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
On January 1, 2009, Smith Company purchased 12% bonds, having a maturity value of $500,000 for $537,907.40. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2009, and mature January 1, 2014, with interest receivable
Background image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 19

ACC327_EX2_ReviewProblems - -In 2010 Green Company issued,...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online