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2 years ago

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A business is considering a cash outlay of $880,000 for the purchase of land, which it intends to lease for $200,000 per year. I

f alternative investments are available that yield a 15 percent return, the opportunity cost of the purchase of the land is

1 answer:

viva [34]2 years ago

7 0

Answer:

132000$

Explanation:

880000 *0,15=132000

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E16-4. On January 1.2013, when its $30 par value common stock was selling for $80 per share, Plato Corp. issued $10,000,000 of 8

coldgirl [10]

Answer:

A. Dr Cash Account $10,800,000

Cr To Bonds Payable $10,000,000

Cr To Premium Payable $800,000

B.Dr Bonds Payable account $3,000,000

Dr Premium on bonds payable Debited $2,700,000

Cr To Common Stock $7,500

Cr Additional paid in capital $5,692,500

Explanation:

(a) Preparation of the journal entry to record the original issuance of the convertible debentures

Dr Cash Account $10,800,000

Cr To Bonds Payable $10,000,000

Cr To Premium Payable $800,000

($10,000,000*8/100=$800,000)

(Being issue of share on convertible debenture)

b.Preparation of the journal entry to record the exercise of the conversion option, using the book value method

Dr Bonds Payable account $3,000,000

Dr Premium on bonds payable Debited $2,700,000

Cr To Common Stock $7,500

Cr Additional paid in capital$5,692,500

($3,000,000+$2,700,000-$7,500)

(Being maintain the record of outstanding conversation of debenture)

Calculation for for BONDS CONVERTED

First step is to calculate the amortization for 2013

Amortization for 2013=$10,000,000/20

Amortization for 2013=$500,000

Second step is to calculate the amortization for 2014

Amortization for 2014=$10,000,000/20

Amortization for 2014=$500,000

Third step is to Calculate the premium on bonds payable

Premium on bonds payable=$10,000,000−($500,000+$500,000)

Premium on bonds payable=$9,000,000

Now let calculate the bonds converted

Bonds converted=$9,000,000×30/100

Bonds converted=$2,700,000

Calculation for COMMON STOCK

First step is to calculate the number of bonds

Number of bonds=$10,000,000/1000

Number of bonds=10,000

Second step is to calculate Price for the bond

Price for the bond=10,000×5

Price for the bond=50,000

Third step is to Calculate for Stock Split

Stock Split=50,000/2

Stock Split=25,000

Now let calculate the common stock

Common stock=25,000×30/100

Common stock=7,500

Calculation for BONDS PAYABLE

Bonds Payable=10,000,000×30/100

Bonds Payable=3,000,000

6 0

2 years ago

Read 2 more answers

Scenario C At DoubleTalk, Inc., Joe, a supervisor, pushes his employees' performance by constantly checking their work and threa

Mrac [35]

Answer:

in 4 days i will delete brainly warn to friends b btw

Explanation:

4 0

3 years ago

Batterton prepaid a two full years' insurance on December 1 of the current year, $6,960. Record insurance expense for the year

mezya [45]

Answer:

A y a good time for me is that

4 0

2 years ago

On October 15, a company received $15,000 cash as a down payment on a consulting contract. The amount was credited to Unearned C

VLD [36.1K]

Answer:

True

Explanation:

The company received $15000 and credited it to the unearned consulting Revenue accounts because it had not performed any services yet.

According to the accrual principle, the company can only report the amount earned in a period. If the company achieves the required 10% of consulting services by 31st march, it will record 10 percent of $15,000 as its income.

10 percent of $15000= 10/100 x $15000

=$1500

3 0

3 years ago

The following events took place for Digital Vibe Manufacturing Company during January, the first month of its operations as a pr

Ostrovityanka [42]

Answer:

Please see answer below

Explanation:

A. The income statement for Digital Vibe.

Before preparing the income statement, we have to first prepare the net profit or net loss.

= Sales - Cost of goods sold - selling expenses - Administrative expenses

= $875,000 - $525,000 - $125,000 - $80,000

= $145,000

B. Determine the materials inventory, work in process inventory, and finished goods inventory.

Direct materials = Purchase material - Used material

= $168,500 - $149,250

= $19,250.

Work in process inventory = Used material + direct labor wages + Factory overhead - transferred unit

= $149,250 + $360,000 + $120,000 - $600,000

= $29,250

Finished goods = Transferred units - Cost of goods sold

= $600,000 - $525,000

= $75,000

• Please find attached prepared income statement for question 1.

4 0

2 years ago