Question
1) When the market rate of interest was 12%, Patel Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually. The selling price of this
1) When the market rate of interest was 12%, Patel Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually. The selling price of this bond issue was
| a. | $ 321,970 |
| b. | $1,000,000 |
| c. | $ 943,494 |
| d. | $621,524 |
2) When the market rate of interest was 11%, Shah Corporation issued $100,000, 8%, 10-year bonds that pay interest semiannually. Using the straight-line method, the amount of discount or premium to be amortized each interest period would be
| a. | $4,000 |
| b. | $896 |
| c. | $17,926 |
| d. | $1,793 |
3) Bri Cheese Products Co. purchased 1,000 shares of its $5 par common stock at $10 and subsequently sold 500 of the shares at $20. What is the amount of revenue realized by Bri from the sale?
| a. | $0 |
| b. | $5,000 |
| c. | $2,500 |
| d. | $10,000 |
4) Bri Cheese Products Co. purchases 10,000 shares of its own $10 par common stock for $25 per share, recording it at cost. What will be the effect on Bris total stockholders' equity?
| a. | increase, $100,000 |
| b. | increase, $250,000 |
| c. | decrease, $100,000 |
| d. | decrease, $250,000 |
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