1. In a recent year Day Corporation had net income of $150,000, interest expense of $30,000, and a times interest earned ratio of 9. What was Day Corporation's income before taxes for the year? (I will show the answer but explain how to get them for me please,and give solutions)
a. $300,000
b. $270,000
c. $240,000
d. None of the above.
2. The adjusted trial balance for Lifesaver Corp. at the end of the current year, 2007, contained the following accounts. 5-year Bonds Payable 8% $1,000,000 Bond Interest Payable 50,000 Premium on Bonds Payable 100,000 Notes Payable (3 mo.) 40,000 Notes Payable (5 yr.) 165,000 Mortgage Payable ($15,000 due currently) 200,000 Salaries Payable 18,000 Taxes Payable (due 3/15 of next yr) 25,000 The total long-term liabilities reported on the balance sheet are
a. $1,365,000
b. $1,350,000
c. $1,465,000
d. $1,450,00203.
3. Turner Company issued $300,000 of 6%, 5-year bonds at 98. Assuming straight-line amortization and annual interest payments, how much bond interest expense is recorded on the next interest date?
a. $18,000
b. $9,000
c. $18,600
d. $19,200