Question

1)Golden Company received proceeds of $94,250 on 10-year, 8% bonds issued on January 1, 2007. The bonds had a face value of $100,000, pay interest semi-annually on June 30 and December 31, and have a call price of 101. Golden uses the straight-line method of amortization. Golden Company decided to redeem the bonds on January 1, 2009. What amount of gain or loss would Golden report on its 2009 income statement? a)$5,600 gain b)$4,600 loss c)$4,600 gain d)$5,600 loss 2)Simon Company issued 6,000 shares of its 5 par value common stock in payment of its attorney's bill of 45,000. The bill was for services performed in helping the company incorporate. Simon should record this transaction by debiting a)legal expense for $30,000 b)legal expense for $45,000 c)organization expense for $30,000 d) organization expense for $45,000