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Saint leo mba560 test 4




Question;Problem 1. Villarente Company issued 5-year $200,000;face value bonds at 95 on January 1, 2012. The stated interest rate on these;bonds is 9%, and the effective interest rate is 10.33%. Use the effective;interest rate method to complete the amortization schedule below.;Cash;Payment;Interest Expense;Discount Amortization;Carrying;Value;January 1, 2012;December 31, 2012;December 31, 2013;December 31, 2014;December 31, 2015;December 31, 2016;Totals;Problem;2. Allen Corporation was;organized on July 15, 2012. It was authorized to issue 150,000 shares of $25;par value common stock and 50,000 shares of 6% cumulative preferred stock. The;preferred stock had a stated value of $50 per share. The following stock;transactions relate to Allen Corporation.;?;Issued;55,000 shares of common stock for $33 per share.;?;Issued;2,750 shares of the class A preferred stock for $62 per share.;?;Issued;27,500 shares of common stock for $35 per share.;Required;1) Indicate the effect of each of these transactions on Allen's financial;statements. Include dollar amounts in the model, below. After recording the;three transactions, calculate column totals.;2) After these transactions have been recorded, what is the total amount of;stockholders' equity?;3) After these transactions have been recorded, how many shares of common stock;are outstanding?;Assets;=;Equity;Cash Flow;Cash;Common Stock;+;Paid-in Capital in Excess of Par Value;+;Preferred Stock;+;Paid-in Capital in Excess of Stated Value


Paper#43985 | Written in 18-Jul-2015

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