with annual installment payments of

#1 – On November 1, 2015 EZ products borrowed $ 48,000 on 5%, 10 Year notewith annual installment payments of $48,000 plus interest due on November 1 ofeach succeeding year. On November 1, 2016, what will be the balance be in the longterm notes payable account?A) $4,800B) $38,400 C) $48,000 D) $43,200#2 – On January 1, 2015, Bratios Company purchase equipment and signed a 6 yearmortgage note for $80,000 at 15%. The note will be paid in equal annualinstallments of $ 21,139, beginning January 1, 2016. On January 01, 2016, thejournal entry to record the first installment payment will include aA) debit to Interest for $12,000B) debit to Mortgage Payable for $ 21,139C) Credit to Mortgage Payable for $80,000D) Credit to Cash for $9,139#3 – Case Wines Company issues $800,000 of 7%, 10 Year bonds on March 31, 2013.The bond pays interest on March 31 and September 30. Which of the followingstatements is true?A) If the market rate of interest is 8%, the bonds will issue at a discountB) If the market rate of interest is 8%, the bonds will issue at parC) If the market rate of interest is 8%, the bonds will issue at a premiumD) If the market rate of interest is 8%, the bonds will issue above par#4 – Using the present value tables, compute the present value of $ 30,000discounted back 6 periods at 7%A) $ 19,980B) 23,700C) $24,500 D) $18,400#5 – Blandings GlassWARE COMPANY ISSUES $ 1,000,000 OF 8%, 10 YEAR BONDSAT 98 ON FEBRUARY 28, 2014. THE BONDS PAY INTEREST ON FEBRUARY28 AND AUGUST 31. The journal entry to record the issuance would includeaA) debit to cash for $980,000B) credit to discount on bonds payable for $20,000C) credit to bonds payable for $980,000D) debit cash for $1,000,000#6 – On January 1, 2015, Carter Sales issued $ 15,000 in bonds for $14,700. Theywere 6 year bonds with a stated rate of 9%, and semiannual interest. CarterSales uses the straight line method to amortize the bond discount. On June30, 2015,, when carter makes the first payment to bondholders, how muchwill they report as interest expense?A) $25B) $ 675C) $700D) $825#7 – A stream of equal cash payments made at equal time intervals is called anA) Future valueC) annuityB) Compound interestD) present value#8 – On December 1, 2015, fine products borrowed $80,000 on a 4%, 8 year notewith annual installment payments of $ 10,000 plus interest due on December1 of each succeeding year. Which of the following describes the firstinstallment payment made on December 1, 2016?A) $ 10,000 principal plus $ 10,000 interestB) $ 10,000 principal plus $ 3,200 interestC) $ 10,000 principal plus $400 interestD) $ 3,200 interest only#9 – The amazing Widget company issues $500,000 of 6% 10 year bonds at 103 onMarch 31, 2014. The bonds pay interest on March 31 and September 30.Assume that the company uses the straight line method for amortization.The journal entry to record the issuance would include aA) debit cash for $ 515,000B) credit bonds payable for $515,000C) debit premium on bonds payable for $15,000D) debit to cash for $500,000#10 – If bonds with a face value of $ 200,000 are sold at 98 the amount of cashproceeds isA) $196,000 B) $200,000 C) $192,157 D) $ 202,000#11 – Which of the following statement is true of a bond that issued at a discount?A) its stated interest rate higher than the prevailing market valueB) it will repay a lesser amount than the face value at maturityC) it will be sold for less than the face valueD) it will be sold at par#12 – On January 1, 2015 Carter Sales issue a $ 15,000 in bonds for $15,800. Theywere 8 year bonds with a stated rate of 9%, and pay semiannual interest. CarterSales uses a straight line method to amortize the bond premium. After the firstinterest payment on June 30, 2015, what was the bond carrying amount?A) $15,750B) 15,050C)$ 15,800 D) 15,000#13 – Which of the following statements is true if a bond is sold at an amount lessthan its face value ?A) The bond’s stated rate is the same as the prevailing market rate at the time of saleB) The bond is not secured by specific assets of the issuerC) The bond’s stated rate is lower than the prevailing market rate at the time of saleD) The bond’s stated rate is higher than the prevailing market rate at the time of sale#14 – An instrument that matures at one specified time is known as aA) bondB) preferred shareC) letter of creditD) common share#15 – The principal amount of a bond is $65,000 its stated rate is 7%, and the termof the bond is 5 Years. The bond pays interest semiannually. At the time of issue, themarket rate is 8%. Determine the present value of the bonds at issuance.A) $65,000 B)$ 62,393 C) $18,453 D) $44,265#16 – Earning more income on borrowed money than the related interest expense iscalledA) amortizationB) leverageC) premiumD) annuity#17 – When a bond is sold at a price higher than the face value, the difference isknown as aA) face valueB) discountC) premiumD) maturity value#18 – Which of the following statements is true of a bond that is issued at apremium?A) it will be sold at parB) its stated interest rate is lower than the prevailing market rateC) it will repay a greater amount than the face value at maturityD) it will be sold above par#19 – On November 1, 2014, Archangel Services issued $ 300,000 of 8 years bondswith a stated rate of 9% at par. The bonds make semiannual payments onApril 30 and October 31. On December 31, 2014, Archangel made anadjusting entry to accrue interest at year end. How much interest expensewill be recorded at December 31, 2014.A) $ 14,200 B) 13,500C) $27,000 D) $4,500#20 – Which of the following statements is true if a bond is sold for an amount equalto its face value ?A) the bond’s stated rate is the same as the prevailing market rate at time of saleB) the bond is not secured by specific assets of the issuerC) the bonds stated rate is lower than the prevailing market rate at the time ofsaleD) the bonds stated rate is higher than the prevailing market rate at the time ofsale#21 – Blandings glassware company issues $ 1,000,000 of 8%, 10 year bonds at 98on February 28, 2015. The bond pays interest on February 28 and august 31.On august 31, 2015, how much cash did Blandings pay out to bondholders?A) $41,000 B) $39,000 C) $40,000 D) $80,000Write True or False#22 – The balance in the bonds payable account is credit of $72,000. The balance inthe discount on the bonds payable is a debit of $3,500. The balance sheet willreport the bond balance as $7,500#23 – A mortgage payable is a long term debt that is backed with a security interestin specific property.#24 – An alternative to calling the bonds is to purchase them in the open market attheir current market price.#25 – When a bond is sold, the selling price is generally equivalent to the presentvalue of the bond payments#26 – Federal Unemployment Taxes payables is typically shown on the balance sheetunder the long term liabilities section.