1 On December 1, 2018, Garden Products borrowed $92,000 on a 5%, 10-year note with annual installment payments of $9,200 plus interest due on December 1 of each subsequent year. Which of the following describes the first installment payment made on December 1, 2019? (Round your answer to the nearest whole number.)

A. $9,200 principal plus $9,200 interest

B. $4,600 interest only

C. $9,200 principal plus $460 interest

D. $9,200 principal plus $4,600 interest

2 Preferred stock is stock ________.

A. that is distributed to employees as annual bonuses

B. that sells for a high price

C. that gives its owners certain advantages over common stockholders

D. that is distributed by corporations to avoid liquidation

3 On January 1, 2019, Castle Services issued $ 178,000 of six year, 12% bonds when the market interest rate was 11%. The bonds were issued for $ 180,000. Castle uses the effective interest method to amortize the bond premium. Semiannual interest payments are made on June 30 and December 31 of each year. Which of the following is the correct journal entry to record the first interest payment? (Round your answers to the nearest dollar number.)

A. Interest Expense 9,900

Premium on Bonds Payable 780

Cash 10,680

B. Cash 10,680

Premium on Bonds Payable 890

Interest Expense 9,790

C. Interest Expense 9,790

Discount on Bonds Payable 890

Cash 10,680

D. Interest Expense 9,790

Cash 9,790

4 From its inception through the year of 2017, First Mart, Inc. was profitable and made strong dividend payments each year. In the year 2018, First Mart had major losses and paid no dividends. In 2019, the company started making large profits again, and they were able to pay dividends to all share holders long dashboth common and preferred. There are 1,600shares of cumulative,11% preferred stock outstanding. The preferred stock has a par value of $100.00. What is the total amount of dividends that should be paid to the preferred stockholders in December, 2019?

A 35200

B17600

C 86

D 52800

5 Using the direct method, interest expense paid on a note payable is included in the operating activities section of the statement of cash flows. T/F