Questions from Accounting Principles

Q: a. What is the cost of an investment in bonds?

a. What is the cost of an investment in bonds? b. When is interest on bonds recorded?

Q: Paris Electric sold $3,000,000, 10%,

Paris Electric sold $3,000,000, 10%, 10-year bonds on January 1, 2020. The bonds were dated January 1 and pay interest annually on January 1. Paris Electric uses the straight-line method to amortize b...

Q: Molino Inc. reported sales revenue of $2 million for 2020

Molino Inc. reported sales revenue of $2 million for 2020. Accounts receivable decreased $200,000 and accounts payable increased $300,000. Compute cash receipts from customers, assuming that the recei...

Q: a. What are the major sources (inflows) of cash

a. What are the major sources (inflows) of cash in a statement of cash flows? b. What are the major uses (outfows) of cash?

Q: What is the cost of an investment in stock?

What is the cost of an investment in stock?

Q: Ling Corporation uses the equity method to account for its ownership of

Ling Corporation uses the equity method to account for its ownership of 35% of the common stock of Gorman Packing. During 2020, Gorman reported a net income of $80,000 and declares and pays cash divid...

Q: a. What is a statement of cash flows?

a. What is a statement of cash flows? b. Mark Paxson maintains that the statement of cash flows is an optional financial statement. Do you agree? Explain.

Q: Jill Ernst is the controller of J-Products, Inc.

Jill Ernst is the controller of J-Products, Inc. At December 31, the end of its first year of operations, the company’s investments in trading debt securities cost $74,000 and have a fair value of $72...

Q: Kelli Deane is discussing the advantages of the effective-interest method

Kelli Deane is discussing the advantages of the effective-interest method of bond amortization with her accounting staff . What do you think Kelli is saying?

Q: Linkin Corporation is considering purchasing a new delivery truck. The truck

Linkin Corporation is considering purchasing a new delivery truck. The truck has many advantages over the company’s current truck (not the least of which is that it runs). The new truck would cost $56...