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1. ACC 304 Final Exam Part 1 (3 Sets) For more classes visit www.snaptutorial.com This Tutorial contains 3 Set of Finals ACC 304 Final Exam Part 1 (3 Sets) 1 1) employee share-purchase plan. Under the terms of plan, employees are entitled to purchase 10 shares at 10% discount. The par values of shares were $10. Overall, 60 employees accepted the offer and each employee purchased six shares. The market price on purchase date was $100. Swing High Inc. offers its 100 employees to participate in an What is the compensation expense recorded by Swing High Inc.? 2) known as the The interest rate written in the terms of the bond indenture is 3) used for intangible assets? Which of the following methods of amortization is normally 4) method of amortization is used, interest expense in the earlier years will If bonds are initially sold at a discount and the straight-line 5) stockholders will increase paid-in capital at the The distribution of stock rights to existing common

2. 6) Treasury shares are shares 7) Which of the following is a contract-related intangible assets? 8) employee payroll deduction? Which of the following taxes does not represent a common 9) face value of $4,000,000 and a stated interest rate of 6%, payable semiannually on June 30 and December 31. The bonds were sold to yield 8%. Table values are: Present value of 1 for 8 periods at 6% Present value of 1 for 8 periods at 8% Present value of 1 for 16 periods at 3% Present value of 1 for 16 periods at 4% Present value of annuity for 8 periods at 6% 6.210 Present value of annuity for 8 periods at 8% 5.747 Present value of annuity for 16 periods at 3% 12.561 Present value of annuity for 16 periods at 4% 11.652 On January 1, 2014, Ellison Co. issued eight-year bonds with a .627 .540 .623 .534 The present value of the interest is 10) Which of the following would be considered research and development costs? 11) On January 1, 2015, Evans Company granted Tim Telfer, an employee, an option to buy 3,000 shares of Evans Co. stock for $25 per share, the option exercisable for 5 years from date of grant. Using a fair value option pricing model, total compensation expense is determined to be $22,500. Telfer exercised his option on September 1, 2015, and sold his 1,000 shares on December 1, 2015. Quoted market prices of Evans Co. stock during 2015 were

3. January 1 September 1 December 1 $25 per share $30 per share $34 per share The service period is for three years beginning January 1, 2015. As a result of the option granted to Telfer, using the fair value method, Evans should recognize compensation expense for 2015 on its books in the amount of 12) Presented below is information related to Hale Corporation: Common Stock, $1 par $4,500,000 Paid-in Capital in Excess of Par―Common Stock Preferred 8 1/2% Stock, $50 par Paid-in Capital in Excess of Par―Preferred Stock Retained Earnings 1,500,000 Treasury Common Stock (at cost) 550,000 2,000,000 400,000 150,000 The total paid-in capital (cash collected) related to the common stock is 13) On October 1, 2014 Macklin Corporation issued 5%, 10-year bonds with a face value of $4,000,000 at 104. Interest is paid on October 1 and April 1, with any premiums or discounts amortized on a straight-line basis. Bond interest expense reported on the December 31, 2014 income statement of Macklin Corporation would be 14) Gannon Company acquired 10,000 shares of its own common stock at $20 per share on February 5, 2014, and sold 5,000 of these shares at $27 per share on August 9, 2015. The fair value of Gannon's common stock was $24 per share at December 31, 2014, and $25 per share at December 31, 2015. The cost method is used to record treasury stock transactions. What account(s) should Gannon credit in 2015 to record the sale of 5,000 shares?

4. 15) When computing diluted earnings per share, convertible bonds are 16) Jeff Corporation purchased a limited-life intangible asset for $225,000 on May 1, 2013. It has a useful life of 10 years. What total amount of amortization expense should have been recorded on the intangible asset by December 31, 2015? 17) A corporation called an outstanding bond obligation four years before maturity. At that time there was an unamortized discount of $750,000. To extinguish this debt, the company had to pay a call premium of $250,000. Ignoring income tax considerations, how should these amounts be treated for accounting purposes? 18) Slack Inc. borrowed $320,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much interest is recognized for the period from April 1 to December 31? 19) Venible newspapers sold 6,000 of annual subscriptions at $125 each on June 1. How much unearned revenue will exist as of December 31? 20) Hanson Co. had 200,000 shares of common stock, 20,000 shares of convertible preferred stock, and $1,000,000 of 5% convertible bonds outstanding during 2015. The preferred stock is convertible into 40,000 shares of common stock. During 2015, Hanson paid dividends of $.60 per share on the common stock and $2 per share on the preferred stock. Each $1,000 bond is convertible into 45 shares of common stock. The net income for 2015 was $400,000 and the income tax rate was 30%. Basic earnings per share for 2015 is (rounded to the nearest penny)

5. 21) Sealy Corporation had the following information in its financial statements for the years ended 2014 and 2015: Cash dividends for the year 2015 Net income for the year ended 2015 87,000 Market price of stock, 12/31/14 Market price of stock, 12/31/15 Common stockholders' equity, 12/31/14 Common stockholders' equity, 12/31/15 Outstanding shares, 12/31/15 100,000 Preferred dividends for the year ended 2015 10,000 $5,000 10 12 1,000,000 1,200,000 What is the payout ratio for Sealy Corporation for the year ended 2015? 22) Jenks Corporation acquired Linebrink Products on January 1, 2015 for $8,000,000, and recorded goodwill of $1,500,000 as a result of that purchase. At December 31, 2015, Linebrink Products had a fair value of $6,800,000. The net identifiable assets of the Linebrink (excluding goodwill) had a fair value of $5,800,000 at that time. What amount of loss on impairment of goodwill should Jenks record in 2015? 23) On December 31, 2014, the stockholders' equity section of Arndt, Inc., was as follows: Common stock, par value $10; authorized 30,000 shares; issued and outstanding 9,000 shares $90,000 Additional paid-in capital 116,000 Retained earnings 184,000 Total stockholders' equity $390,000 On March 31, 2015, Arndt declared a 10% stock dividend, and accordingly 900 additional shares were issued, when the fair value of the stock was $18 per share. For the three months ended March 31,

6. 2015, Arndt sustained a net loss of $32,000. The balance of Arndt’s retained earnings as of March 31, 2015, should be 24) On September 1, 2014, Halley Co. issued a note payable to Fidelity Bank in the amount of $1,800,000, bearing interest at 10%, and payable in three equal annual principal payments of $600,000. On this date, the bank's prime rate was 11%. The first payment for interest and principal was made on September 1, 2015. At December 31, 2015, Halley should record accrued interest payable of ACC 304 Final Exam Part 1 (3 Sets) 2 1) (download it from my account section) Please use those as well for your finals and please either use the question number or some data from question to search as they usually change the company keeping the data same We have also attached download of Chapter 12, 13, 14, 15, 16 2) Convertible bonds 3) bond issue convertible into 2,000 shares of common stock (par value $20). At the time of the conversion, the unamortized premium is $2,000, the market value of the bonds is $110,000, and the stock is quoted on the market at $60 per share. If the bonds are converted into common, what is the amount of paid-in capital in excess of par to be recorded on the conversion of the bonds? Litke Corporation issued at a premium of $5,000 a $100,000 4) outstanding at December 31, 2014. No common stock was issued during 2015. On January 1, 2015, Didde issued 200,000 shares of nonconvertible preferred stock. During 2015, Didde declared and paid $75,000 cash dividends on the common stock and $60,000 on the preferred stock. Net income for the year ended December 31, 2015 Didde Co. had 300,000 shares of common stock issued and

7. was $465,000. What should be Didde's 2015 earnings per common share? 5) 40,000 shares of its $10 par value common stock to its key employees. The market price of the common stock on that date was $23 per share and the option price was $20. The Black-Scholes option pricing model determines total compensation expense to be $420,000. The options are exercisable beginning January 1, 2015, provided those key employees are still in Weiser’s employ at the time the options are exercised. The options expire on January 1, 2016. Weiser Corp. on January 1, 2012, granted stock options for On January 1, 2015, when the market price of the stock was $29 per share, all 40,000 options were exercised. The amount of compensation expense Weiser should record for 2015 under the fair value method is 6) January 1, following the payment of interest. The carrying value of the bonds at the redemption date is $311,235. The entry to record the redemption will include a Carr Corporation retires its $300,000 face value bonds at 105 on 7) bonds with a face value of $4,000,000 at 104. Interest is paid on October 1 and April 1, with any premiums or discounts amortized on a straight-line basis. On October 1, 2014 Macklin Corporation issued 5%, 10-year The entry to record the issuance of the bonds would include a credit of 8) March 1, 2014 at 97 plus accrued interest. The bonds are dated January 1, 2014, and pay interest on June 30 and December 31. What is the total cash received on the issue date? Farmer Company issues $25,000,000 of 10-year, 9% bonds on