Testbank Multiple Choice Question 81 At the beginning of 2020, Sunland Company issued 8% bonds with a face value of $5700000. These bonds mature in the five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $5259870 to yield 10%. Sunland uses a calendar-year reporting period. Using the effective-interest method of amortization, what amount of interest expense should be reported for 2020

Answer:

$527,737

Explanation:

The Bond Payment or Coupon always includes the Interest Portion and the the Capital Potion. The question only requires the Interest Portion of the Bond.

The Bond Parameters can be set as :

PV = - $5,259,870

FV = $5,700,000

PMT = ($5,700,000 x 8%) ÷ 2 = $228,000

N = 5 x 2 = 10

YTM = 10 %

P/YR = 2

Constructing an amortization schedule for 2020 gives :

Date            Capital Portion         Interest              Balance

June 30           $34,994              $262,994        $5,294,864

Dec 30             $36,743               $264,743         $5,331,607

Total                  $71,737                $527,737         $5,331,607

therefore,

The amount of interest expense to be reported for 2020 is $527,737

Suppose a firm produces with a technology that exhibits constant returns to scale at all levels of production. The firm's inputs are workers and laptops. The firm sells its output in a perfectly competitive market. It also hires its inputs (hires workers and rents laptops) in perfectly competitive markets. Assume that in the long run the firm produces y units of output using x1 workers and x2 laptops. If the firm doubles the amount of workers and laptops (using 2x1 and 2x2), we would expect the firm's long-run profits to

Rainey Company's true cash balance at October 31 is $4,700. The following information is available for the bank reconciliation: Outstanding checks, $740 Deposits in transit, $540 Bank service charges, $110 The bank had collected an account receivable for Rainey Company, $1,200 The bank statement included an NSF check written by one of Ramsey's customers for $720. What was the unadjusted book balance at October 31

The multiplier effect occurs when an initial increase (or decrease) in autonomous expenditure produces a greater increase (or decrease) in real GDP than the initial change. In which type of discretionary fiscal policy does the multiplier play a role? tax changes only neither government spending changes nor tax changes government spending changes only both government spending changes and tax changes Assume a marginal propensity to consume (MPC) of 0.5. Which discretionary fiscal policy would have a more pronounced impact on the economy? A 800 billion dollar increase in government spending, or a 800 billion dollar tax cut, would both have an equal impact on the economy. A 800 billion dollar increase in government spending would have a more pronounced impact on the economy. A 800 billion dollar tax cut would have a more pronounced impact on the economy.

The amount of money that is earned on a deposit is​

Total demand for Oxy is 10,000 units and for Sonic is 6,000 units. Machine time is a scarce resource. During the year, 50,000 machine hours are available. Oxy requires 4 machine hours per unit, while Sonic requires 2.5 machine hours per unit. What is the maximum contribution margin Garrison can achieve during a year

Organizations face myriad barriers and obstacles to effectively increasing and embracing diversity in their workplaces. Some of these barriers stem from people in the organization who are resistant to changing the organization to make it more diverse. This activity is important because resistance to this type of change is an attitude that managers will come up against frequently, and managers should be able to recognize when this occurs so that they can manage the organization and its employees through this challenging but very important type of change.
The goal of this exercise is to challenge your knowledge of the barriers to diversity.
Stereotypes and Prejudices
Fear of Discrimination Against Majority Group Members
Resistance to Diversity Program Priorities
A Negative Diversity Climate
Lack of Support for Family Demands
A Hostile Work Environment for Diverse Employees
First, hover over the terms to read examples of barriers to diversity in action. Then, click and drag each term to indicate the specific barrier to diversity its example best depicts.

On average, your firm receives 65 checks a day from customers. These checks, on average, are worth $39.90 each and clear the bank in 1.5 days. In addition, your firm disburses 38 checks a day with an average amount of $89.50. These checks clear your bank in 2 days. What is the average amount of the collection float? $2,473.80 $3,401.00 $3,890.25 $5,101.50 $6,802.00

Setting and achieving goals is essential to success.

a. True
b. False

John received a promotion at work and felt new clothes would be necessary in the new position. John went to a local store and charged three ties on his charge account at a cost of $60 each. Bill, a friend of John's, saw a sidewalk vendor selling ties at a cost of three for $10 and bought three at that price. The friends compared purchases that night and found that they had purchased identical ties. John became enraged and said that he would not pay the charge-account bill because the ties were clearly not worth $60 each. Bill indicated that he would testify on John's behalf if litigation ensued. What would be the probable outcome of the lawsuit

Marigold Corp. incurs the following costs to produce 10100 units of a subcomponent: Direct materials $8484 Direct labor 11413 Variable overhead 12726 Fixed overhead 16200 An outside supplier has offered to sell Marigold the subcomponent for $2.85 a unit. If Marigold could avoid $3000 of fixed overhead by accepting the offer, net income would increase (decrease) by $838. $(3364). $6838. $(5929).

You are planning to save for retirement over the next 35 years. To do this, you will invest $710 per month in a stock account and $310 per month in a bond account. The return of the stock account is expected to be 9.1 percent, and the bond account will earn 5.1 percent. When you retire, you will combine your money into an account with an annual return of 6.1 percent. Assume the returns are expressed as APRs.

How much can you withdraw each month from your account assuming a 30-year withdrawal period?

Negotiations often involve three types of issues. For ______________ issues, the parties' preferences are directly opposed. For ______________ issues, the parties have directionally-opposed preferences but value the issues differently. For ______________ issues, the parties have the same preferences.

On January 1, Alan King decided to deposit $58,800 in a savings account that will provide funds four years later to send his son to college. The savings account will earn 8% annually. Any interest earned will be added to the fund at year-end (rather than withdrawn). (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the appropriate factor(s) from the tables provided.) Required:

Times-Roman Publishing Company reports the following amounts in its first three years of operation: ($ in thousands) 2021 2022 2023 Subscription revenue recognized (earned) $ 350 $ 360 $ 320 Subscription payments received in cash 390 340 360 The difference between pretax accounting income and taxable income is due to subscription revenue for one-year magazine subscriptions being reported for tax purposes in the year received, but reported in the income statement in later years when the performance obligation is satisfied. The income tax rate is 25% each year. Times-Roman anticipates profitable operations in the future. Required: 1. What is the balance sheet account that gives rise to a temporary difference in this situation

Castle Corporation conducts business in States 1, 2, and 3. Castle’s $630,000 taxable income consists of $555,000 apportionable income and $75,000 allocable income generated from transactions conducted in State 3. Castle’s sales, property, and payroll are evenly divided among the three states, and the states all employ a three-equal-factors apportionment formula.
Determine how much of Castle’s income is taxable in each of the following states.
a. State 1: $ _________
b. State 2: $ _________
c. State 3: $ _________

Elizabeth reports the following items for the current year: Nonbusiness capital gains $ 5,000 Nonbusiness capital losses (3,000) Interest income 3,000 Itemized deductions (including a $20,000 casualty loss in a Federal disaster area) (27,000) In calculating Elizabeth's net operating loss and with respect to these amounts only, what amount must be added back to taxable income (loss)

Inside the packaging of a new bread machine she purchases, Ginger finds a paper stating, "All our products will be replaced within the first year if they fail to operate correctly. However, consumer misuse or abuse will effectively end this policy." This is a(n) a. implied warranty. b. express warranty. c. statement of guarantee. d. set of instructions for use. e. labe

The Fabricating Department started the current month with a beginning Work in Process inventory of $10,900. During the month, it was assigned the following costs: direct materials, $76,900; direct labor, $24,900; and factory overhead, 70% of direct labor cost. Also, inventory with a cost of $113,500 was transferred out of the department to the next phase in the process. The ending balance of the Work in Process Inventory account for the Fabricating Department is: Group of answer choices $83,461. $196,961. $68,030. $16,630. $112,700.

Which of the following industries is most likely to outsource jobs to another country because of slight increases in labor costs?

a. Milk dairy.
b. High-tech research facility.
c. Textile plant.
d. Automobile assembly plant.

Carol Beal is the export manager at Gudrun Sjoden USA, a licensed distributor for a Swedish designer. Carol has North America and all of Asia in her territory. She has just formed a joint venture to run retail branches in Tokyo, Shanghai, and Seoul. Her plan is to ship directly from the Gudrun Sjoden warehouse in Stockholm. Her Asian partner has requested she ship to her DDP, but Carol would prefer to ship Ex Works. Carol knows that there are critical differences between the two terms of sale and is reviewing what decision to make. She wants to keep her U.S. expenses as low as possible, and she would be funding the shipping out of the United States. She also wants to continue to build a good, solid, trusting relationship with her joint venture partner.

Which statement is true Carol ships goods Ex Works?
a. The buyer would cover shipping and insurance costs assume the risk the door.
b. The seller would cover all insurance costs while the buyer would cover the cost of shipping.
c. The goods be shipped from Stockholm at the seller's expense.
d. The seller would cover all shipping and insurance costs and assume the risk at the factory door.
e. The buyer would cover all insurance costs while the seller would cover the cost of shipping

A firm' s sales procedure involves preparing sales invoices based on shipping documents; posting the sales amounts to accounts receivable records; and posting quantities billed to the inventory records. Due to control weaknesses in the procedure, certain goods that are shipped may not be reflected in the sales invoices. The exposure from this risk can result in:

Sunland purchased the license for distribution of a popular consumer product on January 1, 2020, for $158,000. It is expected that this product will generate cash flows for an indefinite period of time. The license has an initial term of 5 years but by paying a nominal fee, Sunland can renew the license indefinitely for successive 5-year terms. What amount should be amortized for the year ended December 31, 2020

Super Saver Groceries purchased store equipment for $43,000. Super Saver estimates that at the end of its 10-year service life, the equipment will be worth $4,000. During the 10-year period, the company expects to use the equipment for a total of 13,000 hours. Super Saver used the equipment for 1,200 hours the first year. Required: Calculate depreciation expense of the equipment for the first year, using each of the following methods. (Do not round your intermediate calculations.)

Otto and Monica are married taxpayers who file a joint tax return. For the current tax year, they have AGI of $99,600. They have excess depreciation on real estate of $59,760, which must be added back to AGI to arrive at AMTI. The amount of their mortgage interest expense for the year was $19,920, and they made charitable contributions of $9,960. They have no other itemized deductions. If Otto and Monica's taxable income for the current year is $69,720, determine the amount of their AMTI.

Suppose you are the money manager of a $5.21 million investment fund. The fund consists of four stocks with the following investments and betas: Stock Investment Beta A $ 320,000 1.50 B 780,000 (0.50) C 1,260,000 1.25 D 2,850,000 0.75 If the market's required rate of return is 10% and the risk-free rate is 5%, what is the fund's required rate of return

Jane Industries manufactures plastic toys. During October, Jane's Fabrication Department started work on 10,400 models. During the month, the company completed 11,200 models, and transferred them to the Distribution Department. The company ended the month with 2200 models in ending inventory. There were 3000 models in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is being followed. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 55% complete as to conversion costs.


Beginning inventory​:

Direct materials costs $20,000
Conversion costs $11,100

Manufacturing costs added during the accounting period​:

Direct materials costs $70,700
Conversion costs $240,500

What is the amount of direct materials cost assigned to ending work-in-process inventory at the end of October?


a. $19,783
b. $20,337
c. $10,923
d. $14,916

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Name one thing you're afraid of when you think of college and career.

Haylock Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The direct labor budget indicates that 7,500 direct labor-hours will be required in August. The variable overhead rate is $1.50 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $100,410 per month, which includes depreciation of $8,940. All other fixed manufacturing overhead costs represent current cash flows. The August cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

Harrelson Company manufactures pizza sauce through two production departments: Cooking and Canning. In each process, materials and conversion costs are incurred evenly throughout the process. For the month of April, the work in process accounts show the following debits.
Cooking Canning
Beginning work in process $0 $4,710
Materials 22,030 10,200
Labor 8,740 8,020
Overhead 32,760 28,340
Costs transferred in 55,850
ournalize the April transactions.

The prepaid insurance account had a balance of $11,300 at the beginning of the year. The account was debited for $12,500 for premiums on policies purchased during the year. Journalize the adjusting entry required under each of the following alternatives for determining the amount of the adjustment:

a. The amount of unexpired insurance applicable to future periods is $2,100.
b. The amount of insurance expired during the year is $14,400