Questions from Financial Accounting

Q: Pepper Enterprises owns 95 percent of Salt Corporation. On January 1

Pepper Enterprises owns 95 percent of Salt Corporation. On January 1, 20X1, Salt issued $200,000 of five-year bonds at 115. Annual interest of 12 percent is paid semiannually on January 1 and July 1....

Q: Sibling Company issued $500,000 par value, 10-

Sibling Company issued $500,000 par value, 10-year bonds at 104 on January 1, 20X3, which Mega Corporation purchased. The coupon rate on the bonds is 11 percent. Interest payments are made semiannuall...

Q: Stallion Corporation sold $100,000 par value, 10-

Stallion Corporation sold $100,000 par value, 10-year first mortgage bonds to Pony Corporation on January 1, 20X5. The bonds, which bear a nominal interest rate of 12 percent, pay interest semiannuall...

Q: Purse Corporation owns 70 percent of Scarf Company’s voting shares. On

Purse Corporation owns 70 percent of Scarf Company’s voting shares. On January 1, 20X3, Scarf sold bonds with a par value of $600,000 at 98. Purse purchased $400,000 par value of the bonds; the remain...

Q: Proctor Corporation purchased bonds of its subsidiary from a non affiliate during

Proctor Corporation purchased bonds of its subsidiary from a non affiliate during 20X6. Although Proctor purchased the bonds at par value, a loss on bond retirement is reported in the 20X6 consolidate...

Q: Select the correct answer for each of the following questions.

Select the correct answer for each of the following questions. 1. [AICPA Adapted] Wagner, a holder of a $1,000,000 Palmer Inc. bond, collected the interest due on March 31, 20X8, and then sold the bon...

Q: Suspect Company issued $600,000 of 9 percent first mortgage

Suspect Company issued $600,000 of 9 percent first mortgage bonds on January 1, 20X1, at 103. The bonds mature in 20 years and pay interest semiannually on January 1 and July 1. Prime Corporation purc...

Q: Suspect Company issued $600,000 of 9 percent first mortgage

Suspect Company issued $600,000 of 9 percent first mortgage bonds on January 1, 20X1, at 103. The bonds mature in 20 years and pay interest semiannually on January 1 and July 1. Prime Corporation purc...

Q: Packed Corporation owns 70 percent of Snowball Enterprises’ stock. On January

Packed Corporation owns 70 percent of Snowball Enterprises’ stock. On January 1, 20X1, Packed sold $1 million par value, 7 percent (paid semiannually), 20-year, first mortgage bonds to Kling Corporati...

Q: Punk Corporation purchased 90 percent of Soul Company’s voting common shares on

Punk Corporation purchased 90 percent of Soul Company’s voting common shares on January 1, 20X2, at underlying book value. At that date, the fair value of the non controlling interes...