Company Z manufactures printers, which comes with one-year warranty. During this year, Company Z sold 51,000 units of printers for $510,000 of total revenues. The company estimates that it will cost the company $150 in warranty costs for every unit sold. At the beginning of this year, Company Z reported a liability for estimated warranty costs of $1,000,000. During the year, the company paid $850,000 in warranty claims filed by customers for printers they had bought. At the end of year, what would be the total warranty liability reported on the balance sheet?

• A. $6,800,000
• B. $150,000
• C. $8,650,000
• D. $7,800,000

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Question 22 of 304 Points

On January 1, 2022, Company B issues 10-year bonds with a face value of $1,000,000 and a coupon rate of 6%. The bonds pay interest on June 30 and December 31. The effective interest rate is 5%. The bonds were sold for $1,077,945. If Company B uses effective-interest amortization, how much interest expense should the company record on June 30, 2022?

• A. $32,338
• B. $30,000
• C. $26,949
• D. $25,000

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Question 23 of 304 Points

On January 1, 2022 Company K issued $1,000,000, 5% bonds for $855,000. The market rate of interest for these bonds is 7%. Interest is payable annually on December 31. If Company K uses the effective-interest method of amortizing bond discount, what would be the remaining unamortized bond discount at December 31, 2022?

• A. $135,150
• B. $235,000
• C. $238,050
• D. $134,500

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Question 24 of 304 Points

On June 30, 2022, Company J had outstanding 5-year bonds with 4% coupon rate and $850,000 face value. The company pays interest semi-annually on June 30 and December 31. On June 30, 2022, Company J decided to call all of these bonds by paying 102 of par value. On that date, the unamortized bond discount had a remaining balance of $50,000. How much gain or loss should Company J record as result of retiring these bonds earlier?

• A. $57,000 gain
• B. $67,000 loss
• C. $105,000 gain
• D. $50,000 loss

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Question 25 of 304 Points

On January 1, Company L has 5-year bonds with par value of $1,250,000. Interest is paid every 6 months. Company L uses the effective interest method to amortize bond premiums or discounts. The carrying value of the bonds on January 1 was $1,118,000. On June 30, Company L makes its first interest payment and records the following entry: debiting interest expense for $44,720 and crediting cash for $62,500. What is the annual stated interest rate for the bonds?

• A. 10%
• B. 7.2%
• C. 8%
• D. 5%

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Question 26 of 304 Points

On January 1, 2022, Company T issues 7% bonds with face value of $300,000 for $289,150 to yield 8%. Interest is paid every 6 months on January 1 and July 1. If Company T uses the effective-interest method of amortization, how much interest expense it should record on June 30, 2022?

• A. $23,132
• B. $11,566
• C. $10,500
• D. $10,120

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Question 27 of 304 Points

Company Z needs $12,000,000 in a few years for purchasing a building. The company plans to invest $5,068,920 today in an account that pays 9% interest compounded annually. How many years will it take for Company Z to grow its initial investment to $12,000,000?

• A. 8 years.
• B. 9 years.
• C. 10 years.
• D. 11 years.

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Question 28 of 304 Points

Company D invests $800,000 in an investment account that pays interest annually and compounded? After 15 years, the investment account has a total balance of $3,827,672. What is the stated annual interest rate for Company Ds investment account?

• A. 8%
• B. 9%
• C. 10%
• D. 11%

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Question 29 of 304 Points

Tom is planning to purchase an electric vehicle in 6 years. The vehicle will cost $75,000. His bank account pays 2.5% annually compounded interest. In order to have sufficient fund to purchase the vehicle after 6 years, how much does Tom need to put in the bank account today?

• A. $60,198
• B. $51,545
• C. $64,673
• D. $71,087

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Question 30 of 304 Points

Company R invests $120,500 in an account at the beginning of every year for a total of 6 years. If Company R can earn 8% interest compounded semiannually, what will be the balance in the account at the end of 6 years?

• A. $1,281,677
• B. $820,196
• C. $1,713,133
• D. $1,883,029