Reference no: EM133081141

Question 1 - Willow Enterprises purchased a new 3-D printer for $450,000. Although this printer is expected to last for ten years, Willow Enterprises knows the technology will become old quickly and so they plan to replace this printer in three years. At that point, Willow Enterprises believes she will be able to sell the printer for $30,000.

A. Calculate yearly depreciation using the double-declining-balance method.

B. Calculate depreciation using the straight-line method.

Question 2 - Willow Enterprises issued $800,000 of 10-year bonds with a stated rate of 11% when the market rate was 12%. The bonds pay interest semi-annually. Prepare the first three years of an amortization schedule. Assume that the bonds were issued for $785,350.

Question 3 - Willow Enterprises was organized several years ago and was authorized to issue 4,000,000 shares of $50 par value 6% preferred stock. It is also authorized to issue 1,750,000 shares of $1 par value common stock. In its fifth year, the corporation has the following transactions:

Mar. 1 Purchased 1,000 shares of its own common stock at $11 per share.

Apr. 10 Reissued 500 shares of its common stock held in the treasury for $15 per share.

Jun. 12 Reissued 500 shares of common stock at $9 per share.

Journalize the above transactions.