Reference no: EM132677458

Questions -

Q1) Allstar Company signed a $300,000 mortgage on July 1, 2018 for the purchase of their new garage building. The mortgage entailed equal monthly payments of $3,000 at the end of each month. The interest rate is 6.0% per year. How much interest expense will be paid on August 31, 2018? (Round your answer to the nearest whole dollar.)

Q2) On January 2, 2018, Alpaca Company purchased 14,000 shares of the stock of Zebra Company, and did not obtain significant influence.  The investment is intended as a long-term investment.  The stock was purchased for $12 per share, and represents a 10% ownership stake.  Zebra Company made $55,000 of net income in 2018, and paid dividends of 50 cents per share on December 15, 2018.  On December 31, 2018, Zebra Company's stock was trading on the open market for $15 per share at the end of the year.  Use this information to prepare the General Journal entry(ies) (without explanation) for January 2 purchase and the December 15 & 31, 2018 record of income & gain/loss. If no entry is required then write "No Entry Required."

Q3) On April 1, 2019, Alaska Trading Company issued $900,000 of 6%, 10-year bonds.  The bonds, which were issued at 98, pay interest on October 1 and April 1. Use this information to prepare the General Journal entry (without explanation) to record the April 1, 2019 bond issue. If no entry is required then write "No Entry Required."

Q4) On January 1, 2018, Baltimore Company issued $200,000 face value, 8%, 10-year bonds at 102.  Interest is paid annually on January 1. Baltimore uses the straight-line method for amortization. Use this information to determine the dollar value of the interest expense for the 2018 fiscal year. Round your answer to the nearest whole dollar.