Multiple Choice Question 107

Pharoah Construction Company uses the percentage-of-completion method of accounting. In 2018, Pharoah began work on a contract it had received which provided for a contract price of $41500000. Other details follow:

	2018
Costs incurred during the year	$19600000
Estimated costs to complete as of December 31	13600000
Billings during the year	18500000
Collections during the year	9900000

What should be the gross profit recognized in 2018?

$21900000

$2300000

$4900000

$8300000

Multiple Choice Question 101

Blossom Corporation earns $590000 and pays cash dividends of $175000 during 2018. Dexter Corporation owns 1700 of the 10000 outstanding shares of Blossom. What amount should Dexter show in the investment account at December 31, 2018 if the beginning of the year balance in the account was $830000?

$930300.

$830000.

$70550.

$900550.

Multiple Choice Question 100

Pharoah Company purchased 300 of the 1000 outstanding shares of Darby Company's common stock for $640000 on January 2, 2018. During 2018, Darby Company declared dividends of $120000 and reported earnings for the year of $440000. If Pharoah Company uses the equity method of accounting for its investment in Darby Company, its Equity Investments (Darby) account at December 31, 2018 should be

$640000.

$736000.

$772000.

$604000.

Multiple Choice Question 43

Crane Company has $3800000 of 7% convertible bonds outstanding. Each $1,000 bond is convertible into 30 shares of $30 par value common stock. The bonds pay interest on January 31 and July 31. On July 31, 2018, the holders of $1200000 bonds exercised the conversion privilege. On that date the market price of the bonds was 104 and the market price of the common stock was $35. The total unamortized bond premium at the date of conversion was $270000. Crane should record, as a result of this conversion, a

credit of $180800 to Paid-in Capital in Excess of Par.

loss of $12000.

credit of $206400 to Paid-in Capital in Excess of Par.

credit of $86400 to Premium on Bonds Payable.