The Bradford Company issued 8% bonds, dated January 1, with a face amount of $100 million on January 1, 2018 to Saxton-Bose Corporation. The bonds mature on December 31, 2037 (20 years). For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.):

Required:
1. to 3. Prepare the journal entry to record the purchase of the bonds by Saxton-Bose on January 1, 2018, interest revenue on June 30, 2018 and interest revenue on December 31, 2018 (at the effective rate). (Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record the purchase of the bonds by Saxton-Bose.

Record the interest revenue on June 30, 2018

Record the interest revenue on December 31,2018

Mills Corporation acquired as a long-term investment $240 million of 6% bonds, dated July 1, on July 1, 2018. Mills determined that it should account for the bonds as an available-for-sale investment. The market interest rate (yield) was 4% for bonds of similar risk and maturity. Mills paid $280 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2018, was $270 million.

Required:
1. & 2. Prepare the journal entry to record Mills’ investment in the bonds on July 1, 2018 and interest on December 31, 2018, at the effective (market) rate.
3. At what amount will Mills report its investment in the December 31, 2018, balance sheet?
4. Suppose Moody’s bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on January 2, 2019, for $290 million. Prepare the journal entries to record the sale.

1. Brassard Company manufactured 1,500 units of its only product during 2019. The inputs for this production are as follows:

450 pounds of Raw Material G at $1.50 per pound

300 pounds of Raw Material H at cost of $2,75 per pound

300 direct labor hours at $20 per hour

The firm manufactured 1,800 units of the same product in 2017 with the following inputs:

500 pounds of Raw Material G at a cost of $1,20 per pound

360 pounds of Raw Material H at a cost of $2.50 per pound

400 direct labor hours at $18 per hour

Required:

-The 2017 and 2018 operational partial productivity of Raw Material G and Raw Material H

-The 2017 and 2018 direct labor operational partial productivity

- The 2017 and 2018 financial partial productivity of Raw Material G and Raw Material H

-The 2017 and 2018 financial partial productivity of direct labor

-The total productivity ratio in 2017 and 2018

Computing and Recording Proceeds from the Sale of PPE

The following information was provided in the 2018 10-K of Hilton Worldwide Holdings, Inc.

Note 7: Property and Equipment ($ millions)

Note 7 also revealed that depreciation expense on property and equipment totaled $70 million in 2018. The cash flow statement reported that expenditures for property and equipment totaled $94 million in 2018 and that there was no gain or loss on the sale of property and equipment during the year.

Using the information provided, prepare a journal entry to record the sale of property and equipment in 2018.

On June 30, 2018, Georgia-Atlantic, Inc., leased a warehouse facility from IC Leasing Corporation. The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $478,550 over a four-year lease term, payable each June 30 and December 31, with the first payment at June 30, 2018. Georgia-Atlantic’s incremental borrowing rate is 12%, the same rate IC uses to calculate lease payment amounts. Depreciation is recorded on a straight-line basis at the end of each fiscal year. The fair value of the warehouse is $3.2

Required:

1. Determine the present value of the lease payments at June 30, 2018 that Georgia-Atlantic uses to record the right-of-use asset and lease liability.

2. What pretax amounts related to the lease would Georgia-Atlantic report in its balance sheet at December 31, 2018?

3. What pretax amounts related to the lease would Georgia-Atlantic report in its income statement for the year ended December 31, 2018?

Midwest Bank invests in trading securities. At the beginning of December 2018, the bank held no trading securities. During December of 2018, it entered into the following trading securities transactions:

At the end of December, the Carroll Company common stock had a quoted market price of $79 per share, and the Dynamo Company common stock had a quoted market price of $33 per share.

Required:

Mills Corporation acquired as a long-term investment $260 million of 7% bonds, dated July 1, on July 1, 2018. Mills determined that it should account for the bonds as an available-for-sale investment. The market interest rate (yield) was 5% for bonds of similar risk and maturity. Mills paid $320 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2018, was $300 million.

Required:
1. & 2. Prepare the journal entry to record Mills’ investment in the bonds on July 1, 2018 and interest on December 31, 2018, at the effective (market) rate.
3. At what amount will Mills report its investment in the December 31, 2018, balance sheet?
4. Suppose Moody’s bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on January 2, 2019, for $330 million. Prepare the journal entries to record the sale.

Computation of Basic and Diluted EPS) The information below pertains to Barkley Company for 2018.

Net income for the year
7% convertible bonds issued at par ($1,000 per bond); each bond is convertible into

30 shares of common stock
6% convertible, cumulative preferred stock, $100 par value; each share is convertible

into 3 shares of common stock Common stock, $10 par value
Tax rate for 2018
Average market price of common stock

$1,200,000

2,000,000

4,000,000 6,000,000 40% $25 per share

There were no changes during 2018 in the number of common shares, preferred shares, or convertible bonds outstanding. There is no treasury stock. The company also has common stock options (granted in a prior year) to purchase 75,000 shares of common stock at $20 per share.

Instructions

(a) Compute basic earnings per share for 2018.

(b) Compute diluted earnings per share for 2018.

*PLEASE SHOW ALL YOUR WORK*

Fores Construction Company reported a pretax operating loss of $210 million for financial reporting purposes in 2018. Contributing to the loss were (a) a penalty of $10 million assessed by the Environmental Protection Agency for violation of a federal law and paid in 2018 and (b) an estimated loss of $10 million from accruing a loss contingency. The loss will be tax deductible when paid in 2019. The enacted tax rate is 40%. There were no temporary differences at the beginning of the year and none originating in 2018 other than those described above. Taxable income in Fores’s two previous years of operation was as follows: 2016 $ 115 million 2017 40 million Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss in 2018. Fores elects the carryback option. 2. What is the net operating loss reported in 2018 income statement? 3. Prepare the journal entry to record income taxes in 2019 assuming pretax accounting income is $75 million. No additional temporary differences originate in 2019.

Cansela Corporation uses a periodic inventory system and the LIFO method to value its inventory. The company began 2018 with inventory of 5,600 units of its only product. The beginning inventory balance of $75,600 consisted of the following layers:
  

  
During the three years 2018–2020, the cost of inventory remained constant at $17 per unit. Unit purchases and sales during these years were as follows:
  

  
Required:
1. Calculate cost of goods sold for 2018, 2019, and 2020.
2. Disregarding income tax, determine the LIFO liquidation profit or loss, if any, for each of the three years.
3. Determine the effects of LIFO liquidation on cost of goods sold and net income for 2018, 2019, and 2020. Cansela’s effective income tax rate is 35%.