Ch 9 5 morgan company issues 20 year 750000 bonds

Ch 9 - #5 . Morgan Company issues 20-year, $750,000 bonds with a 9% interest rate. The current market rate is
8%. The amount of cash paid for interest in each semiannual interest payment is:
A. $60,000.
B. $33,750.
C. $67,500.
D. $30,000.
E. $375,000.

Ch 9 - #6 . A company issued 5 year, $100,000 bonds with a 7% interest rate for an issue price of $97,947. The
market rate when the bonds were issued was 7.5%. The discount on bonds recorded at issuance was $2,053. The
amount of interest expense for the first semiannual interest payment is:
Ch 9 - #7 . Manco received $105,500 issue price exchange for issuing $100,000 face amount bonds. What is the
correct journal entry to record this transaction?
Choi
ce
Account Debit Credit
A Bonds Payable 105,5
00
Cash 105,5
00
B Cash 105,5
00
Bonds Payable 105,5
00
C Cash 105,5
00
Bonds Payable 100,0
00
Premium on Bonds 5,500
D Cash 100,0
00
Discount on Bonds 5,500
Bonds Payable 105,5
00
CHAPTER 10
Ch 10 - #1 . Outstanding common stock refers to the total number of shares:

Ch 10 - #2 . Which of the following represents a disadvantage of equity financing?
Ch 10 - #3 . Comfort Mattresses, Inc. sold 26,000 shares of its $1 par value common stock at a cash
price of $12 per share. The entry to record this transaction would be:
A. Debit Cash $312,000; credit Common Stock $26,000; credit Additional Paid-in Capital $286,000.
B. Debit Cash for $312,000; credit Common Stock $312,000.
C. Debit Common Stock $26,000; debit Additional Paid-in Capital $286,000; credit Cash $312,000.
D. Debit Cash $312,000; credit Stock Payable $286,000, credit Common Stock $26,000.
E. Debit Common Stock $26,000; credit Cash $26,000.