1. The face value of a bond is: The value of the interest payments a. b. c. d. The discount placed on the bond The premium placed on the bond The principal amount due at maturity 2. What type of account is Discount on Bonds Payable, and what is its normal balance? a. Contra-Asset, CR balance b. Contra-Asset, DR balance e. Contra liability, DR balance d. Contra-liability, CR balance 3. The face value of a bond less any discount amount for bonds payable is known as: a. The book value of the bond b. The carrying value of the bond c. The net realizable valuc of the bond d. The discount value of the bond 4 In financial statement presentations, the Discount on Bonds Payable account is: a. b. c. d. Added to Bond Interest Expense. Deducted from Bond Interest Expense. Added to Bonds Payable. Deducted from Bonds Payable. Use the following information to answer questions 5 and 6. Mason Co, issued bonds for $100.000 cash at face value. The stated rate of interest for these bonds is 9%, and is paid semi-annually. 5. What is the journal entry to record the issuance of the bonds? DR Cash; CR Bonds payable DR Cash: CR Bonds receivable a. b. c. d. DR Bonds payable; CR Cash DR Bonds payable; CR Bonds receivable 6. If Mason Co. paid $4,500 cash for one of its semi-annual interest payments, the journal entry to record the payment is: a. DR Cash: CR Interest Expense b. DR Interest Expense; CR Cash c. DR Interest Expense; CR Notes Payable d. DR Interest Expense; CR Interest Receivable 7. Lily Co. issued 100 shares of $10 par common stock for $22/share. This event is recorded as: a. b. c. d. DR Cash $2,200: CR Common Stock $2.200 DR Cash $1,000: CR Common Stock $1,000 DR Cash $2,200; CR Common Stock S1,200, CR APIC-Common Stock $1,000 DR Cash $2,200; CR Common Stock $1,000, CR APIC-Common Stock $1,200 8. If a corporation plans to issue S600.000 of 15% bonds at a time when the market rate for similar bonds is 13%, the bonds can be expected to be issued at: a. b. c. d. A premium A discount Their face value Their face value+carrying value Use the following information to answer questions 9-10. Cameron events apply to the company's first year of operations Company was incorporated on January 1, 2016. The f i Issued 3,000 shares of $10 par value common stock at a market price of $25 per ii. Earned $45,000 cash revenue. ili. Incurred $30,000 of cash expenses. iv. Declared a $5,000 cash dividend V. Paid the cash dividend declared in Event iv vi. Bought back 800 shares of the S10 par value common stock for $20 per share. 9. Based only on this information, what is the balance sheet? amount of total equity that Cameron will report on its December 31.2016 a. $54,000 b. $59,000 c $69,000 d. $85,000 10. Based only on this information, what is the amount of net cash from financing activities that Cameron will report on its Statement of Cash Flows for December 31, 2016? a. $54,000 b. $70,000 e. $85,000 d. $96,000 Use the following information to answer questions 11-13, On January 1, 2015, Sampson Corporation issued S-year $100,000 bonds with an 8% stated rate ofinterest at 103 Sampson Corporation pays the interest semi-annually on June 30 and December 31 and uses the straight-line amortization method 11. What is the issuance price for the Sampson Corporation bonds? a. $97,000 b. $100,000 c. $103,000 d. $106,000 12. The journal entry to record the issuance of these bonds includes: a. b. e. d. A debit to Discount on Bonds Payable for $3,000 A debit to Premium on Bonds Payable for $3,000 A credit to Discount on Bonds Payable for $3,000 A credit to Premium on Bonds Payable for $3,000 13. What is the amount that would be credited to cash for the interest payment entry on June 30. 2015? a. $4,000 b. $4,120 C. $8,000 d. $8,240 The following information pertains to questions 14 and 15. On April 1, 2016, Hope Co. borrowed $5,000 from Capital Bank. The note had a 10 percent annual interest rate and a one-year term. Assume that year-end is December 31, 2016. 14. How much interest expense will Hope Co. recognize on its 2016 income statement? a. b. $250. c. $375 d. $500 15. What amount of total liabilities would Hope Co. report on its 12/31/2016 balance sheet? a. $5,000 b. $5,375 . $5,500 d. $5,750. a. b. e. d. Classified balance sheet Multi-step balance sheet Distinguished balance sheet Multiple category balance sheet 17. Treasury stock is: a. When a company sells its stock b. When a company buys back its own stock c. When a company sells its stock to another company d. When a company believes their stock is not worth anything Use the following information to answer nwstions 18 and 19. On January 1, 2015, Red Company borrowed $72,000, by issuing a 5 December 31 each year, beginning in 2015. tallment note. The principal and interest will be paid by making annual payments of $18,033. Payments are to be made 18. What is the amount of interest that will be applied to the first payment on December 31. 20157 a. $5,760 b. $4,778 c. $3,718 d. $1.443 19. What is the principal balance after the payment is made on December 31, 20187 a. $0 b. $16,696 c. $18,033 d. $32,157 Use the following information to answer questions 20 and 21. Vintage Corporation issued bonds with a $400,000 face value and a 9% stated rate of interest on January 1 2016. The bonds carry a 5-year term and sold for 98 of amortization. Interest is payable on June 30 and December 31 of each year. Vintage uses the straight line metod 20. What is the carrying value of the bond liability as of the December 31, 2019 balance sheet? a. $392,000 b. $393,600 c. $398,400 d. $400,000 21. What is the amount of interest expense appearing on the December 31, 2019 income statement? a. $39,000 b. $37,600 c. $36,000 d. $35,280 Use the following information to answer questions 22-24. An employee for Queen Co. earns $4,000 per month. The employee has Queen withhold $700 for Federal taxes, $300 for state taxes. Queen also withholds amounts for Social Security& Medicare. 22. What is the employee's net pay? a. $2,694 b. $2,752 c. $2,942 d. $3,000 23. Assuming the employee has not yet been paid, in the journal entry to record the employee's wages, what amount is debited to the Salary expense account? a. $2,694 b. $2,752 c. $3,000 d. $4,000 2. Assuming the employee has not yet been paid, what is the journal entry to record the employee's wages? a. b. DR Salary payable, CR Cash, CR Payroll tax expense DR Salary expense, DR Payroll tax expense, CR Cash R Salary expense, DR Payroll tax expense, CR Salary payable, CR Payroll taxes payable Dk Salary payable, CR Payroll tax expense, CR Salary expense, CR Payroll taxes payable d. 25. A bond premium is: a. When a bond is sold for less than its face value b. When a bond is sold for more than its face value c. When a bond is sold for the face value less a discount d. When a bond is sold for the face value less an interest charge