10. Rome, Inc. issued bonds with a maturity amount of $500,000 and a maturity ten years from date of issue. If the bonds were issued at a premium, this indicates that * (1 Point) the effective yield or market rate of interest exceeded the stated (nominal) rate. the stated rate of interest exceeded the market rate. the market and nominal rates coincided. no necessary relationship exists between the two rates. 12. On January 1, 2020, Kenan Co. had 140,000 shares of its $3 par value common stock outstanding. On June 1, the corporation acquired 20,000 shares of stock to be held in the treasury. On December 1, when the market price of the stock was $5, the corporation declared a 8% stock dividend to be issued to stockholders of record on December 16, 2020. What was the impact of the 10% stock dividend on the balance of the retained earnings account? * (3 Points) $48,000 decrease $28,800 decrease O $56.000 decrease O No effect 13. Ahmad Company issues 6,000 shares of its $5 par value ordinary shares having a fair value of $20 per share and 8,000 shares of its $15 par value preference shares having a fair value of $60 per share for a lump sum of $180,000. What amount of the proceeds should be allocated to the preference shares? * (3 Points) O $180,000 O $480,000 O $144,000 O $103,800 14. The stockholders' equity section of Lawton Corporation as of December 31, 2006, was as follows: Common stock, par value $2; authorized 20,000 shares; issued and outstanding 10,000 shares Paid-in capital in excess of par Retained earnings $ 20,000 30,000 60,000 $120,000 On March 1, 2007, the board of directors declared a 15% stock dividend, and accordingly 1,800 additional shares were issued. On March 1, 2007, the fair market value of the stock was $5 per share. For the two months ended February 28, 2007, Lawton sustained a net loss of $8,000. What amount should Lawton report as retained earnings as of March 1, 2007? (3 Points) $56,000. $43,000. O $48,400. $50,200. 15. Max plc invested 1,000,000 in Mini Co. for 30% of its outstanding shares. Mini Co. pays out 30% of net income in dividends each year. Use the information in the following T-account for the investment in Mini to answer the following question. Investment in Mini Co. 1,000,000 150,000 45,000 What was Mini Co.'s total net income for the year? 16. In 2006, Berger, Inc., issued for $103 per share, 60,000 shares of $100 par value convertible preferred stock. One share of preferred stock can be converted into three shares of Berger's $25 par value common stock at the option of the preferred stockholder. In August 2007, all of the preferred stock was converted into common stock. The market value of the common stock at the date of the conversion was $30 per share. What total amount should be credited to additional paid-in capital from common stock (share premium-ordinary) as a result of the conversion of the preferred stock into common stock (ordinary shares)? * (3 Points) O $1,020,000. O 780,000 O $1,500,000. O $1,680,000. 17. Max plc invested 1,000,000 in Mini Co. for 30% of its outstanding shares. Mini Co. pays out 30% of net income in dividends each year. Use the information in the following T-account for the investment in Mini to answer the following question. Investment in Mini Co. 1,000,000 150,000 45,000 How much was Max plc's share of Mini Co.'s dividends for the year? 18. Use the information in the following table to answer the following question. Date 1/1/2020 1/4/2020 1/8/2020 1/9/2020 1/10/2020 1/11/2020 Action started the business with 120,000 shares additional share capital with 40,000 repurchase 60,000 shares share split 2 for 1 share dividend 30% repurchase 30,000 shares Compute the W.A number of shares outstanding? (your answer must be in number) 19. On January 1, 2020, Rayan company issued 200,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1, October 1, and January 1. What is the accrual of interest on December 31? 20. Gonzalez Company has 350,000 shares of $10 par value common stock outstanding. During the year, Gonzalez declared a 10% stock dividend when the market price of the stock was $30 per share. Four months later Gonzalez declared a $.50 per share cash dividend. As a result of the dividends declared during the year, retained earnings decreased by (3 Points) * $1,242,500. $525,000. $192,500. O $542,500