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Question: Barry, Hank, and Babe form a company


Barry, Hank, and Babe form a company named Long Ball Investments, hoping to find that elusive home run stock. A new clothing company by the name of Major League Apparel has caught their eye. Major League Apparel has two classes of stock authorized: 5%, $10 par preferred and $1 par value common. Long Ball Investments has the following transactions during the year. None of the investments are large enough to exert a significant influence.
January 2 Purchase 1,500 shares of Major League common stock for $70 per share.
February 14 Purchase 600 shares of Major League preferred stock for $12 per share.
May 15 Sell 300 shares of Major League’s common stock for $62 per share.
December 30 Receive a cash dividend on Major League’s common stock of $0.50 per share and preferred stock of $0.50 per share.
December 31 The fair values of the common and preferred shares are $73 and $14, respectively.
Required:
1. Record each of these investment transactions. (Hint: Preferred stock transactions are recorded like common stock transactions, but preferred stock has no voting rights and therefore ownership provides no influence.)
2. Calculate the balance in the Investments account as of December 31.


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> Portions of the financial statements for Alliance Technologies are provided below. Required: Prepare the operating activities section of the statement of cash flows for Alliance Technologies using the indirect method.

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> Listed below are several transactions. For each transaction, indicate by letter whether the cash effect of each transaction is reported in a statement of cash flows as an operating (O), investing (I), financing (F), or noncash (NC) activity. Also, indica

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> Major League Apparel has two classes of stock authorized: 6%, $10 par preferred, and $1 par value common. The following transactions affect stockholders’ equity during 2021, its first year of operations: January 2 Issue 110,000 shares of common stock for

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> Refer to the information provided in P10–2A. Required: Taking into consideration the beginning balances on January 1, 2021 and all the transactions during 2021, respond to the following for Donnie Hilfiger: 1. Prepare the stockholders’ equity section of

> The stockholders’ equity section of Velcro World is presented here. Required: Based on the stockholders’ equity section of Velcro World, answer the following questions. Remember that all amounts are presented in thousa

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> Donnie Hilfiger has two classes of stock authorized: $1 par preferred and $0.01 par value common. As of the beginning of 2021, 300 shares of preferred stock and 4,000 shares of common stock have been issued. The following transactions affect stockholders

> Match (by letter) the following terms with their definitions. Each letter is used only once. Definitions a. The amount invested by stockholders. b. Shares available to sell. c. Shares can be returned to the corporation at a predetermined price. d. The ea

> Selected financial data for Bahama Bay and Caribbean Key are as follows: Required: 1. Calculate the debt to equity ratio for Bahama Bay and Caribbean Key for the most recent year. Which company has the higher ratio? 2. Calculate the return on assets for

> Coney Island Entertainment issues $1,300,000 of 7% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. Required: Calculate the issue price of a bond and complete the first three rows of an amortization schedul

> On January 1, 2021, Universe of Fun issues $900,000, 8% bonds that mature in 10 years. The market interest rate for bonds of similar risk and maturity is 9%, and the bonds issue for $841,464. Interest is paid semiannually on June 30 and December 31. Requ

> On January 1, 2021, Vacation Destinations issues $40 million of bonds that pay interest semiannually on June 30 and December 31. Portions of the bond amortization schedule appear below: Required: 1. Were the bonds issued at face amount, a discount, or a

> On January 1, 2021, Twister Enterprises, a manufacturer of a variety of transportable spin rides, issues $600,000 of 8% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. Required: 1. If the market interest r

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> On January 1, 2021, Strato Corporation borrowed $2 million from a local bank to construct a new building over the next three years. The loan will be paid back in three equal installments of $776,067 on December 31 of each year. The payments include inter

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> Texas Roadhouse opened a new restaurant in October. During its first three months of operation, the restaurant sold gift cards in various amounts totaling $3,500. The cards are redeemable for meals within one year of the purchase date. Gift cards totalin

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> Caribbean Tours’ total payroll for the month of January was $600,000. The following withholdings, fringe benefits, and payroll taxes apply: Assume that none of the withholdings or payroll taxes has been paid by the end of January (recor

> Brooke Remming is the Chief Executive Officer of Dundem Corp. The board of directors has agreed to pay Brooke a salary of $400,000 plus a 15% bonus if the company’s pretax income increases by at least 10% from the prior year. In the prior year, Dundem re

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> Listed below are several terms and phrases associated with current liabilities. Pair each item from List A (by letter) with the item from List B that is most appropriately associated with it.

> Sub Station and Planet Sub reported the following selected financial data ($ in thousands). Sub Station’s business strategy is to sell the best-tasting sandwich with the highest- quality ingredients. Planet Sub’s busin

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> Solich Sandwich Shop had the following long-term asset balances as of December 31, 2021: Solich purchased all the assets at the beginning of 2019 (3 years ago). The building is depreciated over a 10-year service life using the double-declining-balance me

> The following information relates to the intangible assets of University Testing Services (UTS): a. On January 1, 2021, UTS completed the purchase of Heinrich Corporation for $3,510,000 in cash. The fair value of the net identifiable assets of Heinrich w

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