Showing 71 to 80 of 5145 Questions
  • A company buys a machine for $28,100 on January 1, 2005. The maintenance costs for the years 2005–2008 are as follows: 2005, $2,100; 2006, $2,300; 2007, $8,700 (includes $6,500 for cost of a new motor installed in December 2007); 2008, $2,400.Instructions:1. Assume the machine is recorded in a single account at a cost of $28,100. Althou

  • A company has 10,000,000 shares outstanding and needs to raise $100,000,000 in equity funds. Stockholders have preemptive rights, so the firm must initially offer new stock to current stockholders. While a share sells for $35, management believes that it can successfully offer new stock to existing stockholders for $32, a discount of appr

  • A company issues a $1,000,000, 10%, ten-year bond that pays semiannual interest of $50,000 ($1,000,000 × 10% × ½), receiving cash of $1,065,040. Journalize the bond issuance.

  • A company issues a $2,000,000, 12%, five-year bond that pays semiannual interest of $120,000 ($2,000,000 × 12% × ½), receiving cash of $2,154,429. Journalize the bond issuance.

  • A company purchased a $5,000, 25-year zero-coupon bond for $820 to yield 8.5% to maturity.How is the interest revenue computed?

  • A company received life insurance proceeds on the death of its president before the end of its fiscal year. It intends to report the amount in its income statement as an extraordinary item. Would this reporting be in conformity with generally accepted accounting principles? Discuss.

  • A company that borrows money to construct its own building generally should include the interest paid on the loan during the construction period in the cost of the building. Why?

  • A company that manufactures recreational pedal boats has approached Mike Cichanowski to ask if he would be interested in using Current Designs’ rotomold expertise and equipment to produce some of the pedal boat components. Mike is intrigued by the idea and thinks it would be an interesting way of complementing the present product line.O

  • A company’s current ratio is 2.0. Suppose the company uses cash to retire notes payable due within 1 year. What would be the effect on the current ratio and asset turnover ratio?

  • A consultant commented that “too often the numbers look good but feel bad.” This comment often stems from estimation error common to capital budgeting proposals that relate to future cash flows. Three reasons for this error often exist. First, reliably predicting cash flows several years into the future is very difficult. Second, the

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