1. Glax has the following information available on December 31, Year 2:

Income tax expense	$30,500
Decrease in income taxes payable	(9,000)
Increase in deferred tax liability	10,000
Decrease in deferred tax asset	(15,000)

What amount should Glax report for cash paid for income taxes for Year 2 in its statement of cash flows, assuming the direct method is used?

A.$14,500

B.$29,500

C.$34,500

D.$39,500

2. Clay Corp. sold $500,000 of 8%, five-year bonds for $550,000. The purchasers were issued 2,000 detachable warrants, each of which was for one share of Clay's $5 par value common stock at $12 per share. Shortly after issuance, the warrants sold at a market price of $10 each. What amount of premium on the bonds should Clay record at issuance?

A.$20,000

B.$24,000

C.$30,000

D.$50,000