Question 1 on dec 31 2017 abc co has outstanding 500000, Ask an Expert

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Question: 1. On Dec 31 2017, ABC Co. has outstanding $500,000 face amount, 9%, 20-year convertible bonds that pay interest semiannually. After semiannual amortization on Dec. 31, 2017, the remaining bond premium is $8,000. On the first day of the next fiscal year ( January 1, 2018), 50% (half) of the bonds are converted to 750 shares of $50 par value common stock. The market value of the shares issued is $250,000. Prepare the necessary journal entry to record the conversion of the bonds.

2. On January 1, 2016 Vera Co. had 100,000 shares of $5 par common stock outstanding. The following transactions took place during 2016. Vera declared and issued a 20% stock dividend on March 15. On July 1, Vera purchased 10,000 shares of its common stock . On October 1, Vera issued 14,000 shares for cash.

a) What is the total number of shares outstanding as of Dec. 31

b) What is the weighted-average number of shares outstanding as of Dec. 31

c) On Dec 31 2016 Vera Co had a Net Income of $350,000 and declared preferred dividends of $85,000. Calculate the Earnings Per share for 2016.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92709968

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