ACCT HW 10 - BE10-7 Correct. The balance sheet for Reading...

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Unformatted text preview: BE10-7 Correct. The balance sheet for Reading Company reports the following information on July 1, 2010. READING COMPANY Balance Sheet (partial) Long-term liabilities Bonds payable $2,000,000 Less: Discount on bonds payable 30,000 $1,970,000 Reading decides to redeem these bonds at 102 after paying annual interest. Prepare the journal entry to record the redemption on July 1, 2010. (List multiple debit/credit entries from largest to smallest amount, e.g. 10, 5, 2.) Date Account/Description Debit Credit July 1 Bonds payable 2000000 Loss on bond redemption 70000 Cash 2040000 Discount on bonds payable 30000 BE10-11 (a) Correct. The Canadian National Railway Company's (CN) total assets in a recent year were $24,004 million and its total liabilities were $14,180 million. That year, CN reported operating lease commitments for its locomotives, freight cars, and equipment totalling $740 million. If these assets had been recorded as capital leases, assume that assets and liabilities would have risen by approximately $740 million. Calculate CN's debt to total assets ratio, first using the figures as reported, and then after increasing assets and liabilities for the unrecorded operating leases. (Round to 0 decimal places, ie. 25.) Without operating leases 59 % With operating leases 60 % E10-1 Correct. Melissa Hoadley and Kelly Quayle borrowed $16,000 on a 7-month, 9% note from Gopher State Bank to open their business, MK's Coffee House. The money was borrowed on June 1, 2010, and the note matures January 1, 2011. ( a ) Pre pare the entr y to reco rd the rece ipt of the fun ds fro m the loan . D a t e A c c o u n t / D e s c r i p t D e b i t C r e d i t i o n J u n e 1 C a s h 1 6 N o t e s P a y a b l e 1 6 ( b ) Pre par e the entr y to accr ue the inte rest on Jun e 30. D a t A c c D e b C r e e o u n t / D e s c r i p t i o n i t d i t J u n e 3 I n t e r e s t e x p e n s e 1 2 I n t e r e s t p a 1 2 y a b l e (c) Assuming adjusting entries are made at the end of each month, determine the balance in the interest payable account at December 31, 2010. $ 840 ( d ) Pre pare the entr y requ ired on Jan uary 1, 201 1, whe n the loan is paid bac k....
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This note was uploaded on 07/02/2011 for the course ACCT 201 A taught by Professor Hoffman during the Spring '11 term at CSU Fullerton.

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ACCT HW 10 - BE10-7 Correct. The balance sheet for Reading...

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