McBean Inc. reported net income of $300,000 for the year ended December 31, 2009. McBean Inc. had 50,000 shares of common stock outstanding throughout 2009. On January 1, 2009, McBean Inc. issued 400, five-year, $1,000 face value bonds at par. The bonds pay 6 percent interest, and each bond can be converted into 20 shares of common stock. Assume McBean Inc. has a 30 percent income tax rate. None of the bonds were converted in 2009. Required: 1 Compute the basic EPS and diluted EPS for McBean Inc. for 2009. 5. On Nov 1, 2010 you purchased a 2 year insurance policy for $4800. You debited insurance expense. At the end of the year you did not prepare an adjustment. The books are closed. What is the entry to be prepared at the beginning of 2011? 6. On Sept 1, 2010 you received $3600 of rental income 1 year in advance. You credited rent revenue. At the end of the year you did not prepare an adjustment. The books are closed. What is the entry to be prepared at the beginning of 2011? 7. On Oct 1, 2010 you borrowed $12000 and issued a 1 year note payable. The interest rate was 8%. At the end of the year you did not prepare an adjustment. The books are closed. What is the entry to be prepared at the beginning of 2011? 8. On Jan 1, 2010 you had in supplies inventory $1200. On Feb 1 you purchased supplies costing $1800 and you debited supplies expense. On April 1, you purchased supplies costing $500 and debited supplies. On November 1, you purchased $900 of supplies and debited supplies expense. At the end of the year you had $300 of supplies on hand. You did not make an adjusting entry. The books are closed. What is the entry to be prepared at the beginning of 2011?
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