Compute the Following: A

question 65

Essay

Compute the following:
a.
Carder & Company purchased equipment for $24,000 with a useful life of eight years and no expected salvage value.Prepare the adjusting entry for the first year using the straight-line depreciation method and compute the book value at the end of the second year of the equipment's life.
b.
DAC Company pays its employees every Friday.On January 2,20--,the Company paid $6,000 for the 5 days beginning the previous December 29.Prepare the adjusting entry on December 31.

---

Definitions:

Convertible Bonds

Bonds that can be converted into a predetermined number of the issuing company's shares at certain times during the bond's life, usually at the discretion of the bondholder.

Earnings Before Taxes

A company's profitability measure calculated by subtracting all expenses, except taxes, from revenues.

Earnings Per Share

A company's profit divided by its number of outstanding shares of common stock.

Convertible Bond

A type of bond that allows bondholders the option to convert their debt into a predetermined number of shares of the issuing company.