Questions from Financial Accounting

Q: Which accounts are debited and which are credited if a bond issue

Which accounts are debited and which are credited if a bond issue originally sold at a premium is redeemed before maturity at 97 immediately following the payment of interest?

Q: Harvard Inc. issues $4 million, 5-year,

Harvard Inc. issues $4 million, 5-year, 8% bonds at 102, with interest payable on January 1. The straight-line method is used to amortize bond premium. (a) Prepare the journal entry to record the sale...

Q: Underwood Boutique reported the following financial data for 2017 and 2016.

Underwood Boutique reported the following financial data for 2017 and 2016. Instructions (a) Calculate the current ratio for Underwood Boutique for 2017 and 2016. (b) Suppose that at the end of 2017,...

Q: Jayne Corporation has 10,000 shares of $15 par value

Jayne Corporation has 10,000 shares of $15 par value common stock outstanding when it announces a 3-for-1 split. Before the split, the stock had a market price of $120 per share. After the split, how...

Q: Penny Lennon, the chief financial officer of Johnson Inc., is

Penny Lennon, the chief financial officer of Johnson Inc., is considering the options available to her for financing the company’s new plant. Short-term interest rates right now are 6%, and long-term...

Q: What is the formula for computing the payout ratio? Do you

What is the formula for computing the payout ratio? Do you expect this ratio to be high or low for a growth company?

Q: Based on its statement of cash flows, in what stage of

Based on its statement of cash flows, in what stage of the product life cycle is Apple?

Q: Comparative financial statement data for Loeb Corporation and Bowsh Corporation, two

Comparative financial statement data for Loeb Corporation and Bowsh Corporation, two competitors, appear below. All balance sheet data are as of December 31, 2017. Instructions (a) Comment on the rela...

Q: Presented below is the partial bond discount amortization schedule for Rohr Corp

Presented below is the partial bond discount amortization schedule for Rohr Corp., which uses the effective-interest method of amortization. Instructions (a) Prepare the journal entry to record the p...

Q: The international accounting firm Ernst & Young performed a global survey on

The international accounting firm Ernst & Young performed a global survey on fraud. The results of that survey are summarized in a report titled “Driving Ethical Growth—New Markets, New Challenges” (E...