a. ABC Co. issues $100,000, 4%, 10 year bonds when the prevailing market rate of interest is 5%. The bonds pay interest annually. Compute the issue price of the bonds.

b. ABC Co. issues $100,000, 4%, 10 year bonds when the prevailing market rate of interest is 5%. The bonds pay interest semi-annually. Compute the issue price of the bonds.

c. ABC Co. issues $500,000, 10%, 10 year bonds when the prevailing market rate of interest is 9%. The bonds pay interest annually. Compute the issue price of the bonds.

d. ABC Co. issues $500,000, 10%, 10 year bonds when the prevailing market rate of interest is 9%. The bonds pay interest semi-annually. Compute the issue price of the bonds.

ABC Construction Co. signed a $2,000,000 contract to construct an office building for the State of Arizona. The project will begin in 2017 and be completed in 2018. The cost of construction is expected to be $1,875,000.

Below is a summary of events for 2017 and 2018:

ABC Construction Co. recognizes revenue upon completion when accounting for long-term contracts.

a. Prepare all journal entries to record costs, billings, collections, and any profit recognition for ABC Construction Co. activities for 2017 only.

b. Prepare any journal entry needed for profit recognition only for ABC Construction Co. activities for 2018.

write a one page summmary on Minutes of the Federal Open Market Committee

Developments in Financial Markets and Open Market Operations
The deputy manager of the System Open Market Account (SOMA) provided a summary of developments in domestic and global financial markets over the intermeeting period; she also reported on open market operations and related issues. Financial markets experienced a notable bout of volatility early in the intermeeting period; volatility was particularly pronounced in equity markets. Market participants pointed to incoming economic data released in early February--particularly data on average hourly earnings--as raising concerns about the prospects for higher inflation and higher interest rates. These concerns reportedly contributed to a steep decline in equity prices and an associated rise in measures of volatility. Some reports suggested that the increase in volatility was amplified by the unwinding of trading positions based on various types of volatility trading strategies. Measures of equity market volatility declined over subsequent weeks but remained above levels that prevailed earlier in the year, and stock prices finished lower, on net, over the intermeeting period. Interest rates rose modestly over the period. Respondents to the Open Market Desk's surveys of primary dealers and market participants suggested that revisions in investors' views regarding the fiscal outlook were an important factor boosting yields and contributing to a slightly steeper expected trajectory of the federal funds rate. The deputy manager noted that a rapid and sizable increase in Treasury bill issuance over recent weeks had put upward pressure on money market yields over the period. Three-month Treasury bill yields moved up significantly and those increases passed through to rates on other short-term instruments such as three-month Eurodollar deposits and commercial paper. The spread of market rates on overnight repurchase agreements over the offering rate at the Federal Reserve's overnight reverse repurchase (ON RRP) facility widened, and take-up at the facility fell to quite low levels as a result. Rates on overnight federal funds and Eurodollar transactions edged higher relative to the interest rate on excess reserves. The Desk continued to execute the FOMC's balance sheet normalization plan initiated in October of last year.

By unanimous vote, the Committee ratified the Open Market Desk's domestic transactions over the intermeeting period. There were no intervention operations in foreign currencies for the System's account during the intermeeting period

Problem 17-07

The following information relates to the debt securities investments of Vaughn Company.

(a)

Prepare any journal entries you consider necessary, including year-end entries (December 31), assuming these are available-for-sale securities. (Note to instructor: Some students may debit Interest Receivable at date of purchase instead of Interest Revenue. This procedure is correct, assuming that when the cash is received for the interest, an appropriate credit to Interest Receivable is recorded.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.

+

Choose your template

FPOspreadsheet

FPOgeneral journal

FPO

Hemming Co. reported the following current-year purchases and sales for its only product.
    

Required:
Hemming uses a perpetual inventory system.
  
1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
2. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
3. Compute the gross margin for FIFO method and LIFO method.

Question 2

Although Sahra now pays Stone & Co Accounting Specialists Pty Ltd to manage the accounting function of the business, she likes to prepare a few journals when she has time. The following general journal entries for the business ‘Vacation’ were prepared by Sahra for transactions occurring in October, however she needs your assistance in posting them to the General Ledger. Sahra has posted the opening balances into the general ledger and they are correct.

Required:

Post the General Journals recorded below to the General Ledger provided on the following page. Remember to foot each ledger to determine the ledger balance.

Post the journals from above to the General Ledger provided below. All ledgers below must be footed (the balance must be made clear either by way of ‘c/d’ / ‘b/d’ notation, the wording ‘balance’ next to the amount, highlight the balance or with a circle around the balance).

Cash at Bank (CAB)

Sewing Mannequin

Equipment

Accounts Payable

Capital

Beachwear Sales

I.T. Expense

Hemming Co. reported the following current-year purchases and sales for its only product

Required:
Hemming uses a perpetual inventory system.
  1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
2. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
3. Compute the gross margin for FIFO method and LIFO method.
Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.