91. The carrying value of the bond liability on the December 31, 2018 balance sheet was:
A. $241,000.
B. $242,500.
C. $237,500.
D. $245,000.
92. The amount of interest expense appearing on the December 31, 2018 income statement would be:
A. $17,500.
B. $12,500.
C. $14,250.
D. $15,000.
93. The amount of cash flow from operating activities on the December 31, 2018 statement of cash flows would be:
A. $17,500.
B. $15,000.
C. $14,250.
D. $12,500.
94. If Wayne issued the bonds for 96,
A. the market rate of interest was equal to the stated rate of interest.
B. the market rate of interest was lower than the stated rate of interest.
C. the market rate of interest was higher than the stated interest rate.
D. the bonds carried a variable or floating rate that changed in response to market conditions.
95. Assuming Wayne issued the bonds for 102½, the carrying value of the bonds on the December 31, 2016 balance sheet would be:
A. $601,500.
B. $613,500.
C. $615,000.
D. $616,500.
96. Assuming Wayne issued the bond for 102½, the amount of interest expense appearing on the 2016 income statement would be:
A. $34,500.
B. $36,000.
C. $37,500.
D. $15,000.
97. Straight-line interest amortization of a premium or discount on bonds payable:
A. assigns variable amounts of interest over the term of the liability.
B. uses compound interest principles.
C. assigns the same amount of interest to each interest period over the term of the liability.
D. is required for U.S. income tax reporting.
98. The carrying value of a bond issued at a premium:
A. decreases by equal amounts each year if straight-line amortization is used.
B. decreases by equal amounts each year if effective interest amortization is used.
C. decreases by larger and larger amounts each year if effective interest amortization is used.
D. decreases by equal amounts each year if straight-line amortization is used and decreases by increasing amounts each year if effective interest amortization is used.
99. Assuming Weller issued the bonds for $431,940, the carrying value of the bonds on the December 31, 2018 balance sheet would be closest to:
A. $420,615.
B. $426,495.
C. $414,264.
D. $404,800.
100. Assuming Weller issued the bond for $431,940, the amount of interest expense appearing on the 2018 income statement would be:
A. $33,649.
B. $20,000.
C. $34,120.
D. $46,350.