Question 49

Q: On January 1, a company borrows $12,000. The annual interest rate is 3 percent. Loan repayment, including all interest, due in 6 months. The company prepares quarterly financial statements on March 31. What amount of interest payable liability will the company report on that date as a result of this borrowing?

	A.	120
	B.	100
	C.	90
	D.	80

1 points

Question 50

Q: A company issues bonds having a face value of $1 million and a stated interest rate of 5 percent. The bonds mature in 5 years and pay interest semi- annually. How much cash interest do these bonds pay every 6 months?

	A.	30,000
	B.	25,000
	C.	15,000
	D.	20,000

1 points

Question 51

Q: On March 29, A company receives an invoice of $10,000 for advertising services used during that month. The company plans to pay the invoice in April. The balance sheet as of March 31 will show:

		Advertising expense of $10,000
		An advertising payable liability of $10,000
		A prepaid advertising asset of $10,000
		None of the above.

1 points