Question 1

The factor 1.08160 is taken from the 4% column and 2 periods row in a certain table. From what table is this factor taken?

Accepted Answer

A)  Future value of 1 
B)  Future value of an annuity of 1 
C)  Present value of 1 
D)  Present value of an annuity of 1 
A)  Future value of 1 
B)  Future value of an annuity of 1 
C)  Present value of 1 
D)  Present value of an annuity of 1

Question 2

On January 1, 2014, JBT Company purchased at face value, a $1,000 6%, bond that pays interest on January 1 and July 1. JBT Company has a calendar year end. The adjusting entry on December 31, 2014, is

Accepted Answer

A)  not required. 
B)    
C)    
D)    
A)  not required. 
B)    
C)    
D)

Question 3

The balance in the Unrealized Loss-Equity account will

Accepted Answer

A)  appear on the balance sheet as a contra asset. 
B)  appear on the income statement under Other Expenses and Losses. 
C)  appear as a deduction in the stockholders' equity section. 
D)  not be shown on the financial statements until the securities are sold. 
A)  appear on the balance sheet as a contra asset. 
B)  appear on the income statement under Other Expenses and Losses. 
C)  appear as a deduction in the stockholders' equity section. 
D)  not be shown on the financial statements until the securities are sold.

Question 4

The following transactions were made by Aquavore Company. Assume all investments are temporary.
July 1 Purchased 400 shares of Delta Corporation common stock for $35 per share.
30 Received a cash dividend of $1.25 per share from the Delta Corporation.
Sept. 15 Sold 80 shares of Delta Corporation stock for $38 per share.
Instructions
Journalize the transactions.

Accepted Answer

The answer of The following transactions were made by Aquavore...

Question 5

When a year-end adjustment is made to reduce the available-for-sale securities portfolio to market, what effect, if any, will the adjustment have on the balance sheet and the income statement?

Accepted Answer

There would be no effect on the income s

Question 6

If $30,000 is put in a savings account paying interest of 4% compounded annually, what amount will be in the account at the end of 5 years?

Accepted Answer

A)  $25,644 
B)  $36,000 
C)  $35,096 
D)  $36,500 
A)  $25,644 
B)  $36,000 
C)  $35,096 
D)  $36,500

Question 7

Suppose you have a winning lottery ticket and you are given the option of accepting $3,000,000 three years from now or taking the present value of the $3,000,000 now. The sponsor of the prize uses a 5% discount rate. If you elect to receive the present value of the prize now, the amount you will receive is

Accepted Answer

A)  $2,591,520. 
B)  $2,518,860. 
C)  $2,670,000. 
D)  $3,000,000. 
A)  $2,591,520. 
B)  $2,518,860. 
C)  $2,670,000. 
D)  $3,000,000.

Question 8

Ando Company earns 11% on an investment that pays back $660,000 at the end of each of the next 5 years. Ando finance department has the following values related to the time value of money to help in its planning process and compounded interest decisions.   To the closest dollar, what is the amount Ando invested to earn the 11% rate of return?

Accepted Answer

A)  $1,112,139 
B)  $391,677 
C)  $2,439,294 
D)  $178,577 
A)  $1,112,139 
B)  $391,677 
C)  $2,439,294 
D)  $178,577

Question 9

Interest is the difference between the amount borrowed and the principal.

Accepted Answer

A) True 
 B)False

Question 10

On January 1, 2014, the LaRoche Company purchased at face value, a $1,000, 4%, bond that pays interest on January 1 and July 1. LaRoche Company has a calendar year end. The adjusting entry on December 31, 2014, is

Accepted Answer

A)  not required. 
B)   
C)   
D)   
A)  not required. 
B)   
C)   
D)

Question 11

Corporations purchase investments in debt or equity securities generally for one of two reasons.

Accepted Answer

A) True 
 B)False

Question 12

Patrick Mazzeo has been offered the opportunity of investing $89,278.45 now. The investment will earn 8% per year and at the end of its life will return $250,000 to Patrick. How many years must Patrick wait to receive the $250,000?

Accepted Answer

A)  10$\thicksim$11 
B)  11$\thicksim$12 
C)  12$\thicksim$13 
D)  13$\thicksim$14 
A)  10$\thicksim$11 
B)  11$\thicksim$12 
C)  12$\thicksim$13 
D)  13$\thicksim$14

Question 13

The formula for the present value of a single amount is FV / (1 + i)N.

Accepted Answer

A) True 
 B)False

Question 14

Brenda Draper borrowed $120,000 on June 1, 2013. This amount plus accrued interest at 8% compounded annually is to be repaid on June 1, 2026. Brenda has obtained the following values related to the time value of money to help her with her financing process and compounded interest decisions.   To the closest dollar, how much will Brenda have to repay on June 1, 2026?

Accepted Answer

A)  $44,124 
B)  $948,454 
C)  $261,554 
D)  $326,354 
A)  $44,124 
B)  $948,454 
C)  $261,554 
D)  $326,354

Question 15

King George Company has these data at December 31, 2014:   The available-for-sale securities are held as a long-term investment.
Instructions
(a) Prepare the adjusting entries to report each class of securities at fair value.
(b) Indicate the statement presentation of each class of securities and the related unrealized gain (loss) accounts.

Accepted Answer

The answer of King George Company has these data at...

Question 16

f Claude Summers invests $14,962.50 now, she will receive $50,000 at the end of 14 years. What annual rate of return will Claude earn on his investment?

Accepted Answer

Use presen

Question 17

On January 1, Connid Company purchased as an investment a $1,000, 8% bond for $1,000. The bond pays interest on January 1 and July 1. What is the entry to record the interest payment on July 1?

Accepted Answer

A)   
B)   
C)   
D)    
A)   
B)   
C)   
D)

Question 18

In present value calculations, the process of determining the present value is called

Accepted Answer

A)  allocating. 
B)  pricing. 
C)  negotiating. 
D)  discounting. 
A)  allocating. 
B)  pricing. 
C)  negotiating. 
D)  discounting.

Question 19

Eglin Company owns 30% interest in the stock of Bosco Corporation. During the year, Rhodes pays $10,000 in dividends to Eglin, and reports a net loss of $250,000. Eglin Company's investment in Bosco will affect Eglin net income by a

Accepted Answer

A)  $10,000 increase. 
B)  $75,000 increase. 
C)  $75,000 decrease. 
D)  $10,000 decrease. 
A)  $10,000 increase. 
B)  $75,000 increase. 
C)  $75,000 decrease. 
D)  $10,000 decrease.

Question 20

Giphons Corp. has common stock of $3,000,000, Retained Earnings of $1,800,000, unrealized gains on trading securities of $60,000 and unrealized losses on available-for-sale securities of $110,000. What is the total amount of their stockholders' equity?

Accepted Answer

A)  $4,690,000. 
B)  $4,800,000. 
C)  $4,740,000. 
D)  $4,630,000. 
A)  $4,690,000. 
B)  $4,800,000. 
C)  $4,740,000. 
D)  $4,630,000.

The factor 1.08160 is taken from the 4% column and 2 periods row in a certain table. From what table is this factor taken?

On January 1, 2014, JBT Company purchased at face value, a $1,000 6%, bond that pays interest on January 1 and July 1. JBT Company has a calendar year end. The adjusting entry on December 31, 2014, is

The balance in the Unrealized Loss-Equity account will

When a year-end adjustment is made to reduce the available-for-sale securities portfolio to market, what effect, if any, will the adjustment have on the balance sheet and the income statement?

If $30,000 is put in a savings account paying interest of 4% compounded annually, what amount will be in the account at the end of 5 years?

Interest is the difference between the amount borrowed and the principal.

On January 1, 2014, the LaRoche Company purchased at face value, a $1,000, 4%, bond that pays interest on January 1 and July 1. LaRoche Company has a calendar year end. The adjusting entry on December 31, 2014, is

Corporations purchase investments in debt or equity securities generally for one of two reasons.

Patrick Mazzeo has been offered the opportunity of investing $89,278.45 now. The investment will earn 8% per year and at the end of its life will return $250,000 to Patrick. How many years must Patrick wait to receive the $250,000?

The formula for the present value of a single amount is FV / (1 + i)^N.

f Claude Summers invests $14,962.50 now, she will receive $50,000 at the end of 14 years. What annual rate of return will Claude earn on his investment?

On January 1, Connid Company purchased as an investment a $1,000, 8% bond for $1,000. The bond pays interest on January 1 and July 1. What is the entry to record the interest payment on July 1?

In present value calculations, the process of determining the present value is called

Eglin Company owns 30% interest in the stock of Bosco Corporation. During the year, Rhodes pays $10,000 in dividends to Eglin, and reports a net loss of $250,000. Eglin Company's investment in Bosco will affect Eglin net income by a

Giphons Corp. has common stock of $3,000,000, Retained Earnings of $1,800,000, unrealized gains on trading securities of $60,000 and unrealized losses on available-for-sale securities of $110,000. What is the total amount of their stockholders' equity?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Filters

Exam 14: Time Value of Money

The factor 1.08160 is taken from the 4% column and 2 periods row in a certain table. From what table is this factor taken?

On January 1, 2014, JBT Company purchased at face value, a $1,000 6%, bond that pays interest on January 1 and July 1. JBT Company has a calendar year end. The adjusting entry on December 31, 2014, is

The balance in the Unrealized Loss-Equity account will

When a year-end adjustment is made to reduce the available-for-sale securities portfolio to market, what effect, if any, will the adjustment have on the balance sheet and the income statement?

If $30,000 is put in a savings account paying interest of 4% compounded annually, what amount will be in the account at the end of 5 years?

Interest is the difference between the amount borrowed and the principal.

On January 1, 2014, the LaRoche Company purchased at face value, a $1,000, 4%, bond that pays interest on January 1 and July 1. LaRoche Company has a calendar year end. The adjusting entry on December 31, 2014, is

Corporations purchase investments in debt or equity securities generally for one of two reasons.

Patrick Mazzeo has been offered the opportunity of investing $89,278.45 now. The investment will earn 8% per year and at the end of its life will return $250,000 to Patrick. How many years must Patrick wait to receive the $250,000?

The formula for the present value of a single amount is FV / (1 + i)N.

f Claude Summers invests $14,962.50 now, she will receive $50,000 at the end of 14 years. What annual rate of return will Claude earn on his investment?

On January 1, Connid Company purchased as an investment a $1,000, 8% bond for $1,000. The bond pays interest on January 1 and July 1. What is the entry to record the interest payment on July 1?

In present value calculations, the process of determining the present value is called

Eglin Company owns 30% interest in the stock of Bosco Corporation. During the year, Rhodes pays $10,000 in dividends to Eglin, and reports a net loss of $250,000. Eglin Company's investment in Bosco will affect Eglin net income by a

Giphons Corp. has common stock of $3,000,000, Retained Earnings of $1,800,000, unrealized gains on trading securities of $60,000 and unrealized losses on available-for-sale securities of $110,000. What is the total amount of their stockholders' equity?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Filters

The formula for the present value of a single amount is FV / (1 + i)^N.