CHAPTERS 9-13
SAMPLE EXAM ANSWERS CHAPTERS 9-13		EXPLANATION
QUES #
1	B
2	D	1000 * .98 =$980
3	C
4	A
5	A	2,000*$50= 100,000 *.05= 5,000
6	D
7	D
8	A	FV = PV * FVIF N, %  ,   $5,000= $2,500 * FVIF N, % , 2=FVIF N, % =8%
9	D	JAN  29, 30 31=3 DAYS   $15,000 * 3/5= $9,000 PAY WEEKDAYS
10	B
11	A
12	A
13	B
14	B
15	A
16	C
17	D	$25,000 *.04*5=$5,000
18	D
19	D
20	D
21	B	SP/PAR VALUE = % OF PAR VALUE,  $204,560/200,000= 102.28
22	C
23	D
24	B
25	D	INTEREST EXP= CV * MARKET RATE, $104,500 * .046 = $4,807
		PREM. AMORTIZED = CASH INTEREST PAID - ACCRUAL INT. EXP
		$1,193              =      $100,000* .06         -     $4,807
26	A
27	A
28	C
29	A
30	A
31	B
32	B
33	B
34	A	TOTAL DIV - PREF DIV = COMMON DIV
		$200,000 - (3 YEARS * $60,000)= $20,000
35	D
36	B	PREF DIV =(.07 * $10 PV )= $.70
		COM DIV= $134,000 - ( .70 *20,000) = $120,000/ 60,000SHARES = $2.
37	A	Small Stk Div = Market Price * # shares issued
		(Transfer from R/E to CC)  $12,000    =       $12        *    1000
		Par Value = 1000 * 5 = 5,000 + 50,000=$55,000
		APIC = $12,000 - 5,000= $7,000 +80,000= $87,000
		R/E + $120,000 - 12,000 = $108,000
38	B	Large Stk Div = Par Value * # shares issued
		(Transfer from R/E to CC)  $300,000    =       $5        *    60000
		Par Value = 60000 * 5 =300,000 + 500,000=$800,000
		R/E + $800,000 - 300,000 = $500,000
39	B
40	B
41	D
42	A
43	B
44	A	Use Value of Stock , more objective & Verifiable  1,000 * $19 = $19,000
		Assets = Liabilities +   Stockholders Equity
		Land                            Contibuted Captial
		$19,000=                            $19,000
45	D
46	C	Assets = Liabilities +                      Stockholders Equity
		Cash                           Treasury Stock          Paid_in capital from TS
		6000    =                            ($4,000)                         $2,000
47	C	10,000 shares * $10 par value*10% * 3 years= $30,000/10,000 sh= $3/share
48	D	$400,000 - $30,000 pref = $370,000 common
49	B	$250,000 + $450,000 NI = $700,000 - $400,000 Div = $300,000
50	C	$200,000-$120,000 = $80,000/$200,000 = 40%
51	A	Net Sales - COGS = Gross Profit - Op Exp = Operating Income
		$300,000  - COGS =       80,000   - $20,000  =  $60,000
52	C	(Net Income- Pref Div)/ WA shares = EPS,  ( $5290 - 1,800 )/WA = $1.25
53	B
54	C
55	A
56	D
57	A
58	B
59	C
60	A
61	C
62	A
63	C
64	E
65	A
66	D
67	A
68	B
69	D
70	C
71	B
72	A
73	D
		Bonds Payable
74	B
		$500,000  Bdg Bal
		Retire Bonds $500,000             $800,000 Issue new Bonds
		$800,000 Ending Bal
Sale price of Bonds = CV of Bonds + Loss ,  $525,000 = $500,000 + $25,000
75	C
76	C
77	C
Last Updated on 6/30/99
By Accounting Department
Email: BRIANLEV@UIC.EDU