As a recently hired accountant for HansIncorporated., you are provided with last year's balance sheet to familiarize yourself with the business Hans Incorporated Balance Sheet December 31, 2018

Assets

Current Assets

Cash $1,054.312

Accounts Receivable 123,200

Short-term Investments 738,054

Inventories 578,366

PrepaidExpenses 82,310

Total Current Assets $2,576,242

Property, plant and equip (net) 832,400

Intangibles and other assets 692,175

Total Assets $4,100,817

Current Liabilities

Accounts payable 69,210

Short-termnotes 131,870

Other currentliabilities 200,574

Total Current Liabilities $401,654

Long-termdebt 1,962,357

Total Liabilities $2,364,011

Stockholders' Equity

Common Stock 1,421,300

RetainedEarnings 315,506

Total Stockholder'sEquity $1,736,806

Total liabilities + Stockholder's $4,100,817

You are also given the following information that list select business activities for the current year, 2019

1. The company acquired as a long-term investment $1 million of 6% bonds, on March 1, 2019. Company management has the positive intent and ability to hold the bonds until they mature in 5 years on March 1, 2024. The market interest rate was 8% for the bonds and the company paid $918,891.04 for the bonds. The company will receive interest semiannually on August 31st and February 28th. As a result of changing market conditions, the fair value of the bonds at December 31, 2019 was $1,050,000. Required: a. Prepare the journal entry to record the investment in the bonds on March 1, 2019 Prepare the journal entry to record the interest payment received on August 31, 2019using the effective (market) interest method b. Prepare the adjusting entry (if necessary) for the change in fair value of the bond at December 31, 2019

2. HansIncorporated buys and sells securities expecting to earn profits on short-term differences in price. They had the following transactions during 2019:

April 1 Purchased 100,000 shares of Apple stock for $1,600,000 June 1 Received cash dividend of $20,000 from Apple Dec 31Thestock price of the Apple was $18.50 per share on December 31st. Required: Record the April 1st and June 1st transactions. Make any necessary adjusting entry at the end of the fiscal year December 31, 2019 due to the change in stock price

3. HansIncorporated pays employees monthly. Payroll information is listed below for August 2019.

Salaries $500,000 Federal income taxes to be withheld $100,000 Federal unemployment tax rate .60% State unemployment tax rate 5.4% Social Security tax rate 6.2% Medicare tax rate 1.45% Required: Prepare the appropriate journal entries to record salaries and wages expense and payroll tax expense for the August 2019 pay period.

4. The HansCompany issued 10% bonds, dated January 1, 2019 with a face amount of $8 million. The bonds mature on December 31, 2028 (10 years). For bonds of similar risk and maturity, the market yield is 12%. Interest is paid semiannually on June 30th and December 31st.Required: 1. Determine the price of the bonds at January 1, 2019 2. Prepare the journal entry to record their issuance on January 1, 2019 3. Prepare the journal entry to record interest on June 30, 2019 (at the effective rate) 4. Prepare the journal entry to record interest on December 31, 2019 (at the effective rate)

5. The information that follows pertains to the HansCompany:

1. At December 31, 2019, temporary differences were associated with the following future taxable (deductible) amounts:

Depreciation $60,000 Prepaid expenses 17,000 Warranty expenses (12,000)

2. No temporary differences existed at the beginning of 2019. 3. Pretax accounting income was $80,000 and taxable income was $15,000 for the year ended December 31, 2019. 4. The tax rate is 40%.

Required: Determine the amounts necessary to record income taxes for 2019 and prepare the appropriate journal entry.

6. Using the information from the balance sheet prepared the following ratios for 2018: a. Current Ratio

b. Acid (Quick) Ratio

c. Debt to Asset Ratio

d. Debt to Equity Ratio

Based upon your accounting knowledge, what wouldbe your assessment of the Hanscompanybased upon these ratios?