ACC 557 Week 6 Chapter 10 ( E10-9 , E10-12 , E10-15 , P10- 1A )
ACC 557 Week 6 Chapter 10 ( E10-9 , E10-12 , E10-15 , P10- 1A )
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ACC 557 Week 6 Chapter 10 ( E10-9 , E10-12 , E10-15 , P10-1A )
E10-9 : Global Airlines is considering two alternatives for the financing of a purchase of a fleet of airplanes . These two alternatives are : ............
It is estimated that the company will earn $ 800,000 before interest and taxes as a result of this purchase . The company has an estimated tax rate of 30 % and has 90,000 shares of common stock outstanding prior to the new financing . Determine the effect on net income and earnings per share for these two methods of financing . ............
E10-12 : Pueblo Company issued $ 300,000 of 5-year , 8 % bonds at 98 on January 1 , 2014 . The bonds pay interest twice a year .
a ) Prepare the journal entry to record the issuance of the bonds . ............
Compute the total cost of borrowing for these bonds .
b ) Prepare the journal entry to record the issuance of the bonds , assuming the bonds were issued at 104 . ............