Question 8 (1 point) During 2024, Arrieta Corporation issues stock options to an employee. In the next year, the employee leaves the company (and fails to satisfy the service requirement). Arrieta Corporation's journal entry to record the change in estimate of the options includes a) no entry needed. b) a debit to the Paid-in Capital - Stock Options and a credit to the Paid-in Capital - Expired Stock Options account. c) a debit to the Compensation Expense and a credit to the Unearned Compensation Expense d) a debit to the Paid-in Capital - Stock Options account and a credit to the Compensation Expense account. Question 9 (1 point) Bote Corp. has 2,000 $1,000 bonds outstanding. Each bond is convertible into 10 shares of $5 par value common stock. The bonds are converted into common stock on December 31, 2024. On this date, the market value of the common stock was $20 per share. At this time the unamortized discount on the bonds was $75,000. The company records the conversion of the bonds using the book value approach. On December 31, 2024, the company's journal entry to record the conversion of the bonds includes a) a debit to discount on bonds payable for $75,000 b) a credit to Paid-in Capital in Excess of Par - Common Stock for $1,900,000. c) a credit to bonds payable for $2,000,000. d) a credit to Paid-in Capital in Excess of Par - Common Stock for $1,825,000. Question 10 (1 point) Heyward Corporation has issued common stock and preferred stock in a lump sum sale on January 2, 2024. The company issued 1,500 shares of common stock and 850 shares of preferred stock for a lump sum of $300,000 cash. The par value of the common stock is $25 per share and par value of the preferred stock is $22 per share. On the date of issuance, the fair value of common stock is $28 per share the fair value of the preferred stock is $32 per share. Each Stock has a ready market for buying and selling the stock. In the journal entry for the issuance of the common stock, how much is credited to the Paid-in-Capital in Excess of Par - Common Stock account? (round calculations to 2 decimal places) a) $163,500 b) $37,500 c) $983,000 d) $145,500 Question 11 (1 point) On December 31, 2023, Contreras Corp. has 1,500 shares outstanding of $20 par value 6% preferred stock and 3,000 shares outstanding of $30 par value common stock. The company did not pay out dividends in 2021 and 2022. As of December 31, 2023, the company will distribute $110,000 in dividends. Contreras began operations January 1, 2021. How much will the common stockholders receive if the preferred stock is non- cumulative and non-participating. (round calculations to 4 decimal places) a) $108,200 b) $5,400 c) $1,800 d) $104,600
