<span>Salary is the correct answer. </span>
Answer: The bondholders decided to convert the bonds into common stock because they believed that getting $2250 today is worth more than $120 interest every year and a $1000 principal payment at the end of the bonds life.
Explanation:
1) In order to find out the number of bonds issued we need to divide 750,000 (Total ) by 1000(Face value of each bond).Total number of bonds issues therefore are 750.
2) A 12 percent convertible bond means that the bond pays a coupon of 120 ( 0.12 * 1000) every year.
3) Each bond is convertible into 25 shares , which means if one bond is converted into common stock, the bond holder can earn $1750. We calculate this number by multiplying the number of shares which is 25 into the current market price of the shares which is 70.
4) Also the company is offering an extra $500 per bond for converting it which means (500/25) an extra $20 per share.
5) So in total the bondholder by converting a bond and selling the shares he gets by converting it can earn $2250 per bond which they bought for a $1000 and gives them 120$ of interest every year.
6) SO to conclude the bondholders decided to convert the bonds into common stock because they believed that getting $2250 today is worth more than $120 interest every year and a $1000 principal payment at the end of the bonds life.
Answer: Cost of goods sold = $62500
Explanation:
Given that,
Sales revenue = $183,000
Ending inventory = $12,600
Beginning inventory = $15,600
purchases = $64,000
purchases discounts = $4,000
purchase returns and allowances = $1,500
freight-in = $1,000
freight-out = $500
Cost of goods sold = Beginning inventory + purchases - purchases discounts - purchase returns and allowances + freight-in - Ending inventory
= $15,600 + $64,000 - $4,000 - $1,500 + $1,000 - $12,600
= $62500
When a firm uses price descrimination, people with an inelastic demand curve will pay higher prices for the item relative to those purchasing the product and have an elastic demand curve
Answer:
employer payroll taxes:
- FICA taxes (social security and medicare) = $39,325 ⇒ employer's FICA taxes are identical to the withheld FICA taxes from employees
- unemployment taxes = $3,825
- total = $39,325 + $3,825 = $43,150
1) total labor cost = total wages + total employer payroll taxes = $550,000 + $43,150 = $593,150
2)
March 31, wages and salaries
Dr Wage expense 550,000
Cr Cash 459,800
Cr Federal income tax withholding payable 50,875
Cr FICA taxes withholding payable (employees) 39,325
3)
March 31, employer payroll taxes
Dr FICA taxes expense 39,325
Dr Unemployment tax expense 3,825
Cr FICA taxes payable 39,325
Cr Unemployment taxes payable 3,825
