Name: 

On April 1, 20X9, Ward Corp. issued $750,000 of 10% nonconvertible bonds at 102 that are due in 10 years.  Each $1,000 bond was issued with 40 detachable stock warrants, each of which entitled the bondholder to purchase one share of Ward $10 par common stock for $25.  On April 1, 20X9, the market value of each warrant was $4.  What amount of the proceeds from the bond issue should Ward record as an increase in stockholders' equity?

On April 1, 20X9, Willard Corp. issued $750,000 of 10% nonconvertible bonds at 102 that are due ten years later.  Each $1,000 bond was issued with 40 detachable stock warrants, each of which entitled the bondholder to purchase one share of Willard $10 par common stock for $25.  On April 1, 20X9, the market value of the warrants was $64,000 and the market value of the bonds was $736,000. .  What amount of the proceeds from the bond issue should Willard record as a bond liability?

The following information relates to the 20X7 activity of the defined benefit pension plan of Lepto Corp., a company whose stock is publicly traded:

Service cost		$150,000
Actual Return on plan assets		40,000
Unexpected gain on plan assets		5,000
Interest cost on projected benefit obligation		82,000
Amortization of experience (actuarial) gain		15,000
Amortization of prior service cost		35,000

Johnson Corp., a company whose stock is publicly traded, provides a noncontributory defined benefit pension plan for its employees.  The company's actuary has provided the following information  20X8:

Projected benefit obligation, January 1		$400,000
Accumulated benefit obligation, January 1		350,000
Plan assets (fair value) January 1		300,000
Service cost for x0X8		120,000
Settlement rate		10%
Expected return on plan assets		8%
Amortization of prior service cost		15,000

In 1995, May Corp. acquired land by paying $75,000 down and signing a note with a maturity value of $1,000,000.  On the note's due date, December 31, 2000, May owed $40,000 of accrued interest and $1,000,000 principal on the note.  May was in financial difficulty and was unable to make any payments.  May and the bank agreed to amend the note as follows:

On December 31, 20X6, Evan Company leased a machine from Ryan for a ten-year period expiring December 30, 20X6.  Equal annual payments under the lease are $100,000 and are due on December 31 of each year. The first payment was made on December 31,20X6, and the second payment was made on December 31, 20X7.  The present value at December 31, 20X6, of the ten lease payments over the lease term discounted at 10% was $676,000.  The lease is appropriately accounted for as a capital lease by Evan.  In its December 31, 20X7 balance sheet, Evan should report a total lease liability of

Nu Corp. agreed to give Rand Co. a machine in full settlement of a note payable to Rand.  The machine's original cost was $140,000.  The note's face amount was $110,000.  On the date of the agreement:

On January l, 20X9, Day Corp. entered into a l0-year lease agreement with Ward, Inc. for industrial equipment.  Annual lease payments of $l0,000 are payable at the end of each year.  Day knows that the lessor expects a l0% return on the lease.  Day has a l2% incremental borrowing rate.  The equipment is expected to have an estimated useful life of l0 years.  In addition, a third party has guaranteed to pay Ward a residual value of $5,000 at the end of the lease.

A safety hazard exists for a manufacturing product.  Occurrence of the loss is reasonably possible and the amount of the loss can be reasonably estimated.  This loss contingency should be

Which of the following components should be included in the calculation of net pension cost recognized for a period by an employer sponsoring a defined benefit pension plan?

The deferred method of tax allocation should be used for

A development stage enterprise

When the occurrence of a gain contingency is probable and its amount can be reasonably estimated, the gain contingency should be

A company's accumulated depreciation for income tax purposes exceeded its accumulated depreciation for financial statement purposes at December 31, 20X7.  the company's effective income tax rate has been forty percent over the asset's life.  With respect to this item, which of the following should be reported in the December 31, 20X7, balance sheet?

If the payment of employees' compensation for future absences is probable, the amount can be reasonably estimated, and the obligation relates to rights that vest, the compensation should be

Temporary differences arise when expenses are deductible for tax purposes

On January 1, 20X8, Kinder Co. has the following balances:

Projected benefit obligation	$2,100,000
Fair value of plan assets	1,800,000

The settlement rate is 10%.  Other data related to the pension plan for 20X8 are:

Service cost		$180,000
Amortization of unrecognized prior service costs		60,000
Contributions		300,000
Benefits paid		105,000
Actual return on plan assets		237,000
Amortization of unrecognized net gain	18,000

Refer to Kinder data: The balance of the projected benefit obligation at December 31, 20X8 is