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finance Questions




Question;Question 1The Boston Chung Company has a building that it originally bought for $100,000. As of December 31, 2012, there is $10,000 of Accumulated Depreciation on the building (it was being straight-line depreciated over 10 years with no salvage value). On January 1, 2013, Boston Chung decides to change the remaining useful life to 5 years (starting now) with a $50,000 salvage value.What will be the depreciation on the building in 2013?$8,000$10,000$13,000$12,500$20,000Question 2Ankit Inc.?s Marketable Securities footnote had the following line items:Marketable Securities at Dec 31, 2012 Amortized Cost Fair ValueTotal Trading Securities $900 $1,000Total Available-for-Sale Securities $4,000 $3,500Total Held-to-Maturity Securities $1,000 $1,200 Total $5,900 $5,700What is the book value of Marketable Securities on Ankit Inc.?s Balance Sheet at December 31, 2012?$6,100$5,900$5,700$5,500$5,800Question 3On January 1, 2012, King John Corp. issued a 3-year, 5% coupon, $100,000 face value bond. The bond was priced at an effective interest rate of 8%, yielding proceeds of $92,137. This is the first and only bond that King John has ever issued.King John?s Statement of Cash Flows for fiscal year 2012 had the following line items: 2012 2011Net Income $11,500 $10,350Depreciation $25,478 $23,675Amortization of Bond Discount $2,418 $0What was King John?s Interest Expense on the bond during fiscal year 2012?$5,000$2,418$7,418$7,371$8,000Question 4On January 1, 2012, Tanenwee Ltd. signed a three-year lease on a delivery truck. The lease requires annual payments of $29,103, which are due at the end of each year. Tanenwee?s managers computed the present value of the lease payments as $75,000 using an effective interest rate of 8%. Tanenwee had to use capital lease accounting treatment for the truck.What was the total expense related to this lease during the fiscal year ended December 31, 2012?$6,000$29,103$25,000$31,000$0Question 5Byant Telecom had the following lines in its Income Taxes footnote:Deferred Tax Liabilities 12/31/2012 12/31/2011Insurance Receivables $(60) $(63)Depreciation $(858) $(745)Other $(808) $(883) Total Deferred Tax Liabilities $(1,726) $(1,691)Bryant Telecom had the following lines in its Statement of Cash Flows: 2012 2011Net Income $4,511 $4,357Depreciation $1,288 $1,236Bryant Telecom is a US company with a 35% Federal Statutory Tax Rate. What was Bryant Telecom?s depreciation expense for tax purposes in fiscal year 2012?$1,288$1,401$1,175$1,611$965Question 6After completing its preliminary financial statements for 2012, Alibasic Shipping Inc. found a mistake in computing its straight-line Depreciation Expense. After fixing the mistake, Alibasic Shipping?s Depreciation Expense was now $10,000 higher. Alibasic Shipping is a US company with a 35% Federal Statutory Tax Rate.How did the $10,000 increase in Depreciation Expense affect Net Income for 2012?Net Income dropped by $6,500Net Income dropped by $3,500Net Income increased by $10,000Net Income increased by $3,500Net Income dropped by $10,000Question 7Ya?ez Inc.?s Balance Sheet had the following line items:Shareholders? Equity 12/31/2012 12/31/2011Common Stock, par value $1 per share $300,000 $300,000 (Shares Issued: 300,000 in 2012 and 300,000 in 2011, Shares Outstanding: 250,000 in 2012 and 220,000 in 2011) Additional Paid in Capital $1,750,500 $1,750,500Retained Earnings $10,321,123 $8,675,309Treasury Stock $(550,000) $(800,000) Total $11,821,623 $9,925,809What was the average price per share paid by Ya?ez to acquire all of the treasury shares held as of December 31, 2012?$10.00$10.50Not enough information$11.00$10.38Question 8For the year ended 12/31/2013, Anonymous Corp. reported Net Income of $100,000, including $10,000 of Interest Expense on convertible debt. Anonymous had 10,000 common shares outstanding throughout 2013. Anonymous paid $4,000 of preferred dividends during 2013. Anonymous? convertible debt is convertible into 2,000 shares of common stock. Anonymous is a US company with a 35% Federal Statutory Tax Rate.What is Anonymous Corp.?s Diluted EPS for fiscal year 2013?$8.54$8.83$7.17$8.29$7.46


Paper#48175 | Written in 18-Jul-2015

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