Discuss the below:
1. A premium on common stock:
(a) Is the amount paid in excess of par by purchasers of newly issued stock
(b) Is the difference between par value and issue price when the amount paid is below par
(c) Represents profit from issuing stock
(d) Represents capital gain on sale of stock Is prohibited in most states
2. A company issues at par 7% bonds with a par value of $500,000 on June 1, which is 5 months after the most recent interest date. How much total cash interest is received on May 1 by the bond issuer?
(a) $0
(b) $2,916.66
(c) $100,000.00
(d) $14,583.33
(e) $35,000.00
3. A corporation was formed on January 1. The corporate charter authorized 100,000 shares of $10 par value common stock. During the first month of operation, the corporation issued 300 shares to its attorneys in payment of a $5,000 charge for drawing up the articles of incorporation. The entry to record this transaction would include:
(a) A debit to Organization Expenses for $3,000
(b) A debit to Organization Expenses for $5,000
(c) A credit to Common Stock for $5,000
(d) A credit to Contributed Capital in Excess of Par Value, Common Stock for $5,000
(e) A debit to Contributed Capital in Excess of Par Value, Common Stock for $2,000
4. A company issues at 9% bonds at par with a par value of $100,000 on April 1, which is 4 months after the most recent interest date. How much total cash interest is received on April 1 by the bond issuer?
(a) $750
(b) $5,250
(c) $1,500
(d) $3,000
(e) $6,000
5. Stock that was reacquired by the company and is still held by the issuing corporation is called:
(a) Capital stock
(b) Treasury stock
(c) Redeemed stock
(d) Preferred stock I need these as soon as possible