DAE Parts Shop began business on January 1, 2019. The corporate charter authorized issuance of 20,000 shares of $5 par value common stock and 5,000 shares of$10 par value, 5% cumulative preferred stock. DAE issued 12,000 shares of common stock at $25 per share on January 2, 2019. What effect does the entry to record the issuance of stock have on total stockholders’ equity?

a. increase of$340,000

b. increase of $300,000

c. increase of$150,000

d. increase of $120,000

Why do investors purchase corporate bonds?

A study of the pay of corporate CEOs (chief executive officers) examined the cash compensation, adjusted for inflation, of the CEOs of 104 corporations over the period 1977 to 1988 . Among the data are the average annual pay increases for each of the 104 CEOs. The mean percent increase in pay was 6.9%. The data showed great variation, with a standard deviation of 17.4%. The distribution was strongly skewed to the right.

What are the degrees of freedom? When the exact degrees of freedom do not appear in Table C, use the next lower degrees of freedom in the table.

On your flight out of South America your cargo plane emergency-lands on a deserted island somewhere in the South Pacific. Because it was a beach landing, the pilot skids the plane on its belly rather than lowering the landing gear. The landing is rough: an initial vertical drop followed by an abrupt horizontal deceleration. When the dust settles, the pilot and your scientist colleagues are all okay, but you know there might be a big problem. Your team is transporting samples of a deadly virus from a recent breakout in a small village. The samples were packed in a cryogenically cooled container that has a special seal that may leak if it exceeds an acceleration greater than 10 g. The container has a mechanical accelerometer gauge that measures the maximum vertical deceleration in case the container is dropped. It reads a value of a=7.30 g. However, you are still worried: there was another component of the acceleration. You get out of the plane and measure the length of the skid the plane made in the sand as it landed: 154 ft. The pilot claims the plane's horizontal speed on impact was 160 m.p.h. Assuming the worst case scenario (i.e., that the vertical and horizontal accelerations occurred simultaneously), and that the horizontal deceleration was uniform, is it likely that the seal on the virus container is compromised? Explain.

Packed Corporation owns 70 percent of Snowball Enterprises' stock. On January 1, 20X1, Packed sold $1 million par value, 7 percent (paid semiannually), 20-year, first mortgage bonds to Kling Corporation at 97. On January 1, 20X8, Snowball purchased$300,000 par value of the Packed bonds directly from Kling for $296,880.

Required

Prepare the consolidation entry needed at December 31, 20X8, to remove the effects of the inter-corporate bond ownership in preparing consolidated financial statements.

The attending physician in an emergency room treats an unconscious patient suspected of a drug overdose. The physician does not know the initial concentration $A_{0}$ of the drug in the bloodstream at the time of injection. However, the physician knows that after 3 hr, the drug concentration in the blood is $0.69 \mathrm{\mu g} / \mathrm{dL}$ and after 4 hr, the concentration is $0.655 \mu \mathrm{g} / \mathrm{dL}$. The model $A(t)=A_{0} e^{-kt}$ represents the drug concentration A(t) (in $\mu \mathrm{g} / \mathrm{dL}$) in the bloodstream t hours after injection. The value of k is a constant related to the rate at which the drug is removed by the body. a. Substitute 0.69 for A(t) and 3 for t in the model and write the resulting equation. b. Substitute 0.655 for A(t) and 4 for t in the model and write the resulting equation. c. Use the system of equations from parts (a) and (b) to solve for k. Round to 3 decimal places. d. Use the system of equations from parts (a) and (b) to approximate the initial concentration $A_{0}$ (in $\mu \mathrm{g} / \mathrm{d} \mathrm{L}$) at the time of injection. Round to 2 decimal places. e. Determine the concentration of the drug after 12 hr. Round to 2 decimal places.

After your discussion with Jason, he asks you whether he should consider buying a corporate bond. Explain to him how bond investing works and the difference between the types of corporate bonds. What type of corporate bond would you recommend? Why?

Explain how corporate profits are taxed twice.

Define the following terms:

Corporate valuation model

What is the difference between corporate and government bonds?

How are savings bonds different from a corporate bond?

Stave Company invests $10,000,000 in 5% fixed rate corporate bonds on January 1, 2020. All the bonds are classified as available-for-sale and are purchased at par. At year-end, market interest rates have declined, and the fair value of the bonds is now$10,600,000. Interest is paid on January 1. Prepare journal entries for Stave Company to (a) record the transactions related to these bonds in 2020, assuming Stave does not elect the fair option; and (b) record the transactions related to these bonds in 2020, assuming that Stave Company elects the fair value option to account for these bonds.

Klon Corporation owns 70 percent of Brant Company's stock and 60 percent of Torkel Company's stock. During 20X8, Klon sold inventory purchased in 20X7 for $100,000 to Brant for$150,000. Brant then sold the inventory at its cost of $150,000 to Torkel. Prior to December 31, 20X8, Torkel sold$90,000 of inventory to a non-affiliate for $120,000 and held$60,000 in inventory at December 31, 20X8.

Required

Give the journal entries recorded by Klon, Brant, and Torkel during 20X8 relating to the inter-corporate sale and resale of inventory.

Molly is a 75-year-old widow who lives alone. For 2 days, she had a fever and chills and mainly stayed in bed. On rising to go to the bathroom, she felt dizzy, fainted, and fell to the floor. Molly quickly regained consciousness and managed to call her son, who took her to the emergency room, where a physician diagnosed orthostatic hypotension. Orthostasis literally means “to stand,” and hypotension refers to low blood pressure; thus, orthostatic hypotension is a significant drop in blood pressure upon standing. When a person moves from lying down to standing, blood “pools” within the veins below the heart because of gravity, and less blood returns to the heart. Consequently, blood pressure drops because the heart has less blood to pump.

Although orthostatic hypotension has many causes, in the elderly it can be due to age-related decreases in neural and cardiovascular responses. Decreased fluid intake while feeling ill and sweating due to a fever can result in dehydration. Dehydration can decrease blood volume and lower blood pressure, increasing the likelihood of orthostatic hypotension.

What happened to Molly’s heart rate just before she fainted? Why did Molly faint?