Use the following in formation to answer questions 18 and 19. On January 1, 2015, Red Company borrowed $72,000, by issuing a 5- year, 8% installment note The principal and interest will be paid by making annual payments of $18,033. Payments are to be made December 31 each year, beginning in 2015 18. What is the amount of interest that will be applied to the first payment on December 31, 2015? a. $5,760 b. $4,778 c. $3,718 d. $1,443 19. What is the principal balance after the payment is made on December 31, 2018? a. $0 b. $16,696 c. $18,033 d. $32,157 1 Use the following information to answer questions 20 and 21. Vintage Corporation issued bonds with a $400,000 face value and a 9% stated rate of nterest on January 1 2016 The bonds carry a 5 year term and sold for 98 Vintage uses the straight-line method of amortization. Interest is payable on June 30 and December 31 of each year. 20. What is the carrying value of the bond liability as of the December 31, 2019 balance sheet? a. $392,000 b. $393,600 c. $398,400 d. $400,000 21. What is the amount of interest expense appearing on the December 31, 2019 income statement? a. $39,000 b. $37,600 c. $36,000 d. $35,280 Use the following information to answer questions 22-24. An employee for Queen Co. earns $4,000 per month. The employee has Queen withhold $700 for Federal taxes, $300 for state taxes. Queen also withholds amounts for Social Security& Medicare. 22. What is the employee's net pay? a. $2,694 b. $2,752 c. $2,94 d. $3,000 23. Assuming the employee has not yet been paid, in the journal entry to record the employee's wages, what amount is debited to the Salary expense account? a. $2,694 b. $2,752 c. $3,000 d. $4,000 Use the following in formation to answer questions 18 and 19. On January 1, 2015, Red Company borrowed $72,000, by issuing a 5- year, 8% installment note The principal and interest will be paid by making annual payments of $18,033. Payments are to be made December 31 each year, beginning in 2015 18. What is the amount of interest that will be applied to the first payment on December 31, 2015? a. $5,760 b. $4,778 c. $3,718 d. $1,443 19. What is the principal balance after the payment is made on December 31, 2018? a. $0 b. $16,696 c. $18,033 d. $32,157 1 Use the following information to answer questions 20 and 21. Vintage Corporation issued bonds with a $400,000 face value and a 9% stated rate of nterest on January 1 2016 The bonds carry a 5 year term and sold for 98 Vintage uses the straight-line method of amortization. Interest is payable on June 30 and December 31 of each year. 20. What is the carrying value of the bond liability as of the December 31, 2019 balance sheet? a. $392,000 b. $393,600 c. $398,400 d. $400,000 21. What is the amount of interest expense appearing on the December 31, 2019 income statement? a. $39,000 b. $37,600 c. $36,000 d. $35,280 Use the following information to answer questions 22-24. An employee for Queen Co. earns $4,000 per month. The employee has Queen withhold $700 for Federal taxes, $300 for state taxes. Queen also withholds amounts for Social Security& Medicare. 22. What is the employee's net pay? a. $2,694 b. $2,752 c. $2,94 d. $3,000 23. Assuming the employee has not yet been paid, in the journal entry to record the employee's wages, what amount is debited to the Salary expense account? a. $2,694 b. $2,752 c. $3,000 d. $4,000
