Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1/ Barnes Company purchased $82,000 of 11.5% bonds at par. The bonds mature in six years and are a held-to-maturity security. Which of the following

1/ Barnes Company purchased $82,000 of 11.5% bonds at par. The bonds mature in six years and are a held-to-maturity security. Which of the following is the correct journal entry to record the receipt of the semiannual interest payment?

Multiple Choice

debt Cash, $4,715; credit Long-Term InvestmentsHTM, $4,715.

debit Cash, $9,430; credit Long-Term InvestmentsHTM, $9,430.

debit Cash, $4,715; credit Interest Revenue, $4,715.

debit Cash, $9,430; credit Unrealized Gain-Equity, $9,430.

debit Unrealized Gain-Equity, $4,715; credit Cash, $4,715.

2/ A company had net income of $50,500, net sales of $759,050, and average total assets of $235,000. Its profit margin and total asset turnover were, respectively:

Multiple Choice

3.23%; 6.65.

21.49%; 6.65.

6.65%; 21.49.

3.23%; 21.49.

6.65%; 3.23.

3/ On February 15, Jewel Company buys 8,000 shares of Marcelo Corp. common stock at $29.03 per share plus a brokerage fee of $450. The stock is classified as available-for-sale securities. This is the companys first and only investment in available-for-sale securities. On March 15, Marcelo Corp. declares a dividend of $1.40 per share payable to stockholders of record on April 15. Jewel Company received the dividend on April 15 and ultimately sells half of the Marcelo Corp. stock on November 17 of the current year for $29.80 per share less a brokerage fee of $300. The journal entry to record the sale of the 4,000 shares of stock on November 17 is:

Multiple Choice

Debit Cash $118,900; credit Long-Term Investments-AFS $116,120; credit Gain on Sale of Long-Term Investments $2,780.

Debit Cash $119,200; credit Long-Term Investments-Trading $116,120; debit Gain on Sale of Long-Term Investments $3,080.

Debit Cash $119,200; credit Long-Term Investments-AFS $116,345; credit Gain on Sale of Long-Term Investments $2,855.

Debit Cash $118,900; credit Long-Term Investments-AFS $116,345; credit Gain on Sale of Long-Term Investments $2,555.

Debit Cash $119,200; credit Long-Term Investments-Trading $116,120; credit Gain on Sale of Long-Term Investments $3,080.

4/ Landmark Corp. buys $500,000 of Schroeter Company's 8%, 5-year bonds payable at par value on September 1. Interest payments are made semiannually. Landmark plans to hold the bonds for the 5-year life. When the bonds mature, the journal entry to record the proceeds will be:

Multiple Choice

Debit Long-Term Investments-HTM $500,000; credit Cash $500,000.

Debit Cash $500,000; credit Interest Revenue $500,000.

Debit Cash $500,000; credit Long-Term Investments-HTM $500,000.

Debit Cash $500,000; credit Interest Receivable $500,000.

Debit Cash $500,000; credit Bonds Payable $500,000.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Environmental Health And Safety Audits A Compendium Of Thoughts And Trends

Authors: Lawrence B. Cahill

2nd Edition

1598889737, 978-1598889734

More Books

Students also viewed these Accounting questions