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On January 1st, XYZ Company issued $200,000, 5-year, 4% bonds. The market rate at the time of the sale was greater than 4% so the bonds were sold at 93. Interest is payable June 30th and December 31st. If the XYZ Company uses the straight-line method to amortize discount on the bonds, the entry to record the first interest payment would include:

A. Debit to Interest Expense for $5,400.
B. Debit to Interest Expense for $9,400.
Credit to Cash for $5,400.
Debit to Discount on Bonds Payable for $1,400.

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Carly’s began operations early this year, selling a product that carries a 1-year warranty; any defective units will be replaced within that time. The product has a cost to Carly of $55 and a selling price of $108.Carly estimates that approximately 1% of the units will be defective. During the year, 62,000 units were sold and 275 units were returned for replacement.What is the balance in Warranty Payable at the end of the current year?

A. $34,100
B. $15,125
C. $18,975
D. $37,260

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On July 1, 2015, a company issued $100,000, 8-year, 4% bonds payable for $93,472, when the market rate of interest was 5%.Interest payment dates are June 30 and December 31.Using the effective interest method of amortization, the carrying amount of the bonds on December 31, 2015 will be:

A. $93,809
B. $93,135
C. $100,000
D. $99,663

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Which of the following statements is TRUE regarding pension liabilities?

A. They originate when a business provides retirement compensation for its employees.
B. If the pension obligation exceeds the market value of the plan assets, that excess is reported as a liability.
C. If the plan assets exceed the pension liability, the asset and obligation amounts are reported only in the notes to the financial statements.
D. All of the above are true.

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Double taxation means that the:

A. corporation's income tax is allocated to the shareholders based on ownership percentage.
B. corporate earnings are subject to state and federal income tax.
C. corporation pays taxes on its earnings and the shareholders pay taxes on the dividends received from the corporation.
D. shareholders' dividends are taxed at the corporate tax rate.

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A. Debit to Interest Expense for $5,400. B. Debit to Interest Expense for $9,400. Credit to Cash for $5,400. Debit to Discount on Bonds Payable for $1,400.

On July 1, 2015, a company issued $100,000, 8-year, 4% bonds payable for $93,472, when the market rate of interest was 5%.Interest payment dates are June 30 and December 31.Using the effective interest method of amortization, the carrying amount of the bonds on December 31, 2015 will be:

Which of the following statements is TRUE regarding pension liabilities?

Double taxation means that the:

A. Debit to Interest Expense for $5,400.
B. Debit to Interest Expense for $9,400.
Credit to Cash for $5,400.
Debit to Discount on Bonds Payable for $1,400.