BE 247
During December 2013, Markowitz Publishing sold 3,000 month annual magazine subscriptions at a rate of $30 each. The first issues were mailed in February 2014. Prepare the entries on Markowitz’s books to record the sale of the subscriptions and the mailing of the first issues.
BE 248
Putman Company had cash sales of $102,600 (including taxes) for the month of June. Sales are subject to 8% sales tax. Prepare the entry to record the sale.
BE 249
Shaffer Inc. is considering two alternatives to finance its construction of a new $5 million plant.
(a)Issuance of 500,000 ordinary shares at the market price of $10 per share.
(b)Issuance of $5 million, 8% bonds at par.
Instructions
Complete the following table.
Issue SharesIssue Bonds
Income before interest and taxes$2,000,000$2,000,000
Interest expense from bonds__________________
Income before income taxes$$
Income tax expense (30%)__________________
Net income$________$________
Outstanding shares_________ 800,000
Earnings per share__________________