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Project Description:

1.) merendo co. sold $600,000, 9%, 10-year bonds on january 1, 2011. the bonds were
dated january 1, and interest is paid on january 1 and july 1.the bonds were sold at 105.

instructions

(a) prepare the journal entry to record the issuance of the bonds on january 1, 2008.

(b) at december 31, 2008, the balance in the premium on bonds payable account is $27,000.
show the balance sheet presentation of accrued interest and the bond liability at december
31, 2008

(c) on january 1, 2010, when the carrying value of the bonds was $624,000, the company redeemed
the bonds at 105. record the redemption of the bonds assuming that interest for the
period has already been paid.

2.) p12-4b on january 1, 2011, argentina corporation had the following stockholders’ equity
accounts.

common stock ($20 par value, 75,000 shares issued and
outstanding) $1,500,000
paid-in capital in excess of par value 200,000
retained earnings 600,000
during the year, the following transactions occurred.
feb. 1 declared a $1 cash dividend per share to stockholders of record on february 15,
payable march 1.

mar. 1 paid the dividend declared in february.

apr. 1 announced a 2-for-1 stock split. prior to the split, the market price per share was $36.

july 1 declared a 10% stock dividend to stockholders of record on july 15, distributable july
31. on july 1, the market price of the stock was $13 per share.
31 issued the shares for the stock dividend.

dec. 1 declared a $0.50 per share dividend to stockholders of record on december 15, payable
january 5, 2009.

31 determined that net income for the year was $350,000.

instructions

(a) journalize the transactions and the closing entry for net income.

(b) enter the beginning balances, and post the entries to the stockholders’ equity accounts.
(note: open additional stockholders’ equity accounts as needed.)

(c) prepare a stockholders’ equity section at december 31.
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Price Type: Negotiable

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