IA
Five years ago, Dunn Trading Co. issued 2,500 ordinary shares. The shares have a 2 par value and sold at that time for 12 per share. On January 1, 2016, Dunn Trading Co. Purchased 1,000 of these shares for /24 per share. On September 30, 2016, Dunn reissued 500 of the shares for 28 per share. The journal entry to record the reissuance will include a. A debit to Treasury Shares 12,000. O b. A credit to Share Premium- Treasury 2,000. O C. A credit to Treasury Shares 14,000. O d. A credit to cash 14,000.The 10% bonds payable of Nixon Company had a net carrying amount of 570,000 on December 31, 2015. The bonds, which had a face value of 600,000, were issued at a discount to yield 12%. The amortization of the bond discount was recorded under the effective-interest method. Interest was paid on January 1 and July 1 of each year. On July 2, 2016, several years before their maturity, Nixon retired the bonds at 102. The interest payment on July 1, 2016 was made as scheduled. What is the loss that Nixon should record on the early retirement of the bonds on July 2, 2016? Ignore taxes. O a. 12,000. b. 37,800. C. 33,600. d. 42,000Black, Inc. is a calendar-year corporation whose financial statements for 2014 and 2015 included errors as follows: Year Ending Inventory Depreciation Expense 2014 162, 000 overstated 135,008 overstated 2015 54, 000 understated 45,000 understated Assume that purchases were recorded correctly and that no correcting entries were made at December 31, 2014, or at December 31, 2015. Ignoring income taxes, by how much should Black's retained earnings be retroactively adjusted at January 1, 2016? a. 144,000 increase b. 36,000 increase c. 18,000 decrease O d. 9,000 increaseWinter Co. is being sued for illness caused to local residents as a result of negligence on the company's part in permitting the local residents to be exposed to highly toxic chemicals from its plant. Winter's lawyer states that it is probable that Winter will lose the suit and be found liable for a judgment costing Winter anywhere from 1,200,000 to 6,000,000. However, the lawyer states that the most probable cost is 3,600,000. As a result of the above facts, Winter should accrue a. a loss contingency of 1,200,000 O and disclose an additional contingency of up to 4,800,000. b. a loss contingency of 3,600,000 and disclose an additional contingency of up to 2,400,000.a. a loss contingency of 1,200,000 O and disclose an additional contingency of up to 4,800,000. b. a loss contingency of 3,600,000 O and disclose an additional contingency of up to 2,400,000. c. a loss contingency of 3,600,000 O but not disclose any additional contingency. d. no loss contingency but disclose O a contingency of 1,200,000 to 6,000,000.Cashman Company reported net income of 255,000 for the year ended 12/31/2016. Included in the computation of net income were: depreciation expense, 45,000; amortization of a patent, 24,000; income from an investment in ordinary shares of Linda Inc., accounted for under the equity method, 36,000; and amortization of a bond premium, 9,000. Cashman also paid a 60,000 dividend during the year. The net cash provided by operating activities would be reported at: a. 279,000. O b. 231,000. c. 219,000. d. 171,000.The ff. audited balances pertain to Wen Company Accts. Payable: Jan. 1, 2016 286, 924 Dec. 31, 2016 737, 824 Inventory balance: Jan. 1, 2016 815, 386 Dec. 31, 2016 498, 874 Cost of goods sold-2016 1, 859, 082 How much was paid by Wen Company to its supplier in 2016? a.P1, 081, 670 b.P1, 065, 900 C.P1, 071, 678 O d. P1, 097, 000
