$1.$ On June $30,2024,$ Moran Corporation issued $$9\mathrm{.}0$ million of its $12\%$ bonds for $$8\mathrm{.}2$ million. The bonds were priced to yield $14\%.$ The bonds are dated June $30,2024.$ Interest is payable semiannually on December $31$ and July $1.$ If the effective interest method is used, by how much should the bond discount be reduced for the six months ended December $31,2024?$

Multiple Choice

$$32,500$

$$3,000$

$$34,000$

$$40,500$

$2.$ Auerbach Incorporated issued $8\%$ bonds on October $1,2024.$ The bonds have a maturity date of September $30,2034,$ and a face value of $$400$ million. The bonds pay interest each March $31$ and September $30,$ beginning March $31,2025.$ The effective interest rate established by the market was $10\%.$

Assuming that Auerbach issued the bonds for $$350,151,360,$ what would the company report for its net bond liability balance on December $31,2024.$

Multiple Choice

$$342,151,000$

$$358,151,000$

$$350,905,000$

$$399,000,000$

$3.$ On January $1,2024,$ Princess Corporation leased equipment to King Company. The lease term is $11$ years. The first payment of $$732,000$ was made on January $1,2024.$ The equipment cost Princess Corporation $$4,527,943.$ The present value of the lease payments is $$4,867,963.$ The lease is appropriately classified as a sales$-$type lease. Assuming the interest rate for this lease is $12\%,$ how much interest revenue will Princess record in $2025$ on this lease?

Multiple Choice

$$468,033$

$$235,684$

$$466,543$

$$496,316$

$4.$ On December $31,2024,$ Perry Corporation leased equipment to Admiral Company for a five$-$year period. The annual lease payment, excluding nonlease components, is $$45,000.$ The interest rate for this lease is $11\%.$ The payments are due on December $31$ of each year. The first payment was made on December $31,2024.$ The normal cash price for this type of equipment is $$135,000$ while the cost to Perry was $$105,000.$ For the year ended December $31,2024,$ by what amount will Perry's earnings increase due to this lease $($ignore taxes$)?$

Multiple Choice

$$20,000$

$$43,000$

$$30,000$

$$40,000$

$5.$ On April $1,2024,$ Austere Corporation issued $$340,000$ of $15\%$ bonds at $107.$ Each $$1,000$ bond was sold with $50$ detachable stock warrants, each permitting the investor to purchase one share of common stock for $$16.$ On that date, the market value of the common stock was $$13$ per share and the market value of each warrant was $$3.$ Austere should record what amount of the proceeds from the bond issue as an increase in liabilities?

Multiple Choice

$$237,300$

$$438,100$

$$0$

$$312,800$