saint mba60 test 4

Question # 00003552 Posted By: mac123 Updated on: 11/14/2013 02:07 PM Due on: 11/21/2013
Subject Finance Topic Finance Tutorials:
Dot Image

Problem 1. Villarente Company issued 5-year $200,000 face value bonds at 95 on January 1, 2012. The stated interest rate on these bonds is 9%, and the effective interest rate is 10.33%. Use the effective interest rate method to complete the amortization schedule below.


Interest Expense

Discount Amortization


January 1, 2012

December 31, 2012

December 31, 2013

December 31, 2014

December 31, 2015

December 31, 2016


Problem 2. Allen Corporation was organized on July 15, 2012. It was authorized to issue 150,000 shares of $25 par value common stock and 50,000 shares of 6% cumulative preferred stock. The preferred stock had a stated value of $50 per share. The following stock transactions relate to Allen Corporation.

· Issued 55,000 shares of common stock for $33 per share.

· Issued 2,750 shares of the class A preferred stock for $62 per share.

· Issued 27,500 shares of common stock for $35 per share.


1) Indicate the effect of each of these transactions on Allen's financial statements. Include dollar amounts in the model, below. After recording the three transactions, calculate column totals.
2) After these transactions have been recorded, what is the total amount of stockholders' equity?
3) After these transactions have been recorded, how many shares of common stock are outstanding?




Cash Flow


Common Stock


Paid-in Capital in Excess of Par Value


Preferred Stock


Paid-in Capital in Excess of Stated Value

Dot Image
Tutorials for this Question
  1. Tutorial # 00003357 Posted By: mac123 Posted on: 11/14/2013 02:08 PM
    Puchased By: 2
    Tutorial Preview
    The solution of saint mba60 test 4...
    Mod4_P_sol.doc (83.5 KB)

Great! We have found the solution of this question!

Whatsapp Lisa