Solution-Calculate the total amount of the cash dividend

Calculate the total amount of the cash dividend

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Question 1 - Rock Company issued a $1,000,000 bond for $924,184 on January 1, 2010. The bond had a 8% stated rate, pays interest annually on December 31, and the market rate of interest was 10%. Rock uses the effective-interest method to account for its bonds.

Prepare the necessary journal entry for each of the following dates (assuming that no adjusting journal entries have been made during the year):

January 1, 2010

December 31, 2010

December 31, 2011

Question 2 - At the end of 2010, Washington Corporation reported a $40,000 balance in its common stock account (par value $1 per share). The treasury stock account balance was $720 (cost $6 per share). During 2010, the company declared and paid a cash dividend at $1.50 per share. Calculate the total amount of the 2010 cash dividend.

Question 3 - On January 1, 2010, Ball Co. leases a bulldozer from CAT Co. for 4 years at $10,000 per year. The lease payments are due at the end of each year. The useful life of that bulldozer is 5 years. There is no bargain purchase option at the end of the lease term. The market interest rate is 10%. Ball Co. uses straight-line depreciation. What should Ball Co. recognize for this lease in journal entries on 1/1/2010 and 12/31/2010?

Reference no: EM133060776

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Calculate the total amount of the cash dividend

Reference no: EM133060776

Reference no: EM133060776

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