1. Bodkin, Inc. has 5,000 shares of 5%, $100 par value, noncumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2014, and December 31, 2015. The board of directors declared and paid a $25,000 dividend in 2014. In 2015, $55,000 of dividends are declared and paid. What are the dividends received by the preferred and common shareholders in 2015? Preferred Common

$27,500

$27,500

$35,000

$20,000

$0

$55,000

$25,000

$30,000

2. Outstanding stock of the Crevusse Corporation included 40,000 shares of $5 par common stock and 20,000 shares of 5%, $10 par noncumulative preferred stock. In 2013, Crevusse declared and paid dividends of $8,000. In 2014, Crevusse declared and paid dividends of $24,000. How much of the 2014 dividend was distributed to preferred shareholders?

$10,000

$8,000

$14,000

None of these answer choices are correct

3. When bonds are sold, the gain or loss on sale is the difference between the

net proceeds and the cost of the bonds.

sales price and the fair value of the bonds.

sales price and the cost of the bonds.

net proceeds and the fair value of the bonds.

4. On January 1 of the current year, Jackson Company purchased as a short-term investment, a $1,000, 8% bond, for $1,050. The bond pays interest semiannually on January 1 and July 1. Jackson Company has a December 31 fiscal year end. The bond is sold on October 1 for $1,100 plus accrued interest. Interest was not accrued since the last interest payment date. What entry will be made on the books of Jackson Company at the time the bond is sold?

debit to Cash, $1,120, credit to Debt Investments, $1,000, credit to Gain on Sale of Debt Investments, $100, and credit to Interest Revenue, $20.

debit to Cash, $1,100 and credit to Debt Investments, $1,100.

debit to Cash, $1,120, credit to Debt Investments, $1,100, and credit to Interest Revenue, $20.

debit to Cash, $1,020, credit to Debt Investments, $1,000, and credit to Interest Revenue, $20.

5. When a company owns more than 50% of the common stock of another company,

significant financial statements are prepared.

affiliated financial statements are prepared.

consolidated financial statements are prepared.

controlling financial statements are prepared. 6. On January 1, Hurley Corporation issues $500,000, 5-year, 12% bonds at 96 with interest payable on July 1 and January 1. The entry on July 1 to record payment of bond interest and the amortization of bond discount using the straight-line method will include a: a. debit to Interest Expense $30,000. b. debit to Interest Expense $60,000. c.credit to Discount on Bonds Payable $4,000. d. credit to Discount on Bonds Payable $2,000.

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7. Assume that Kamchatny Vladimir borrowed $100,000 on January 1 of Year 1, at 5% interest per annum. On December 31, of Year 1, an $8,000 payment is made. On December 31, of year 2, another $8,000 payment is made. Using normal assumptions about interest and principal reduction, how much is the unpaid balance of Vladimir's loan after the second payment?

a. $100,000

b. $94,000

c. $93,850

d. $84,000

8. On June 1, Surge Corporation issued $100,000 of 9%, 5-year bonds. The bonds are dated June 1, 20X1. The bonds were issued at 96, and pay interest on December 1 and June 1. The entry to record issuance of the bonds is:

a.	Cash		100,000
		Bonds Payable			100,000
b.	Cash		96,000
	Discount on Bonds Payable		4,000
		Bonds Payable			100,000
c.	Cash		104,000
		Bond Interest Payable			4,000
		Bonds Payable			100,000
d.	Cash		96,000
	Bond Interest Expense		4,000
		Bonds Payable			100,000

9. In preparing the statement of cash flows, how should noncash investing/financing activities be reported?

a. Not be reported

b. Be reported in a separate schedule accompanying the statement of cash flows

c. Be reported in the investing activities section of the statement of cash flows

d. Be reported in the financing activities section of the statement of cash flows

10. Wilkin Corporation reported accrual basis sales of $200,000, cost of goods sold of $80,000, and operating expenses, taxes, and interest summing to $30,000. In evaluating Wilkin's comparative balance sheets, it is determined that accounts receivable increased $10,000, inventory increased $5,000, and accounts payable decreased $7,000. There were no changes in prepaid expenses nor were there any interest or taxes payable at the beginning or end of the year. How much was cash basis income for Wilkin Corporation for the year?

a. $68,000

b. $82,000

c. $105,000

d. $112,000