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Question 6 On July 1, 2005, Day Co. received $103,288 for $100,000 face amount, 12% bonds, a price that yields 10%. Interest expense for the six months ended December 31, 2005 should be Question 7 On July 1, 2005, Vail Corp. issued rights to stockholders to subscribe to additional shares of its common stock. One right was issued for each share owned. A stockholder could purchase one additional share for 10 rights plus $15 cash. The rights expired on September 30, 2005. On July 1, 2005, the market price of a share with the right attached was $40, while the market price of one right alone was $2. Vail's stockholders' equity on June 30, 2005 comprised the following: By what amount should Vail's retained earnings decrease as a result of issuance of the stock rights on July 1, 2005? Question 8 On January 1, 2005, Wolf Corp. issued its 10% bonds in the face amount of $1,000,000, which mature on January 1, 2015.The bonds were issued for $1,135,000 to yield 8%, resulting in bond premium of $135,000. Wolf uses the effective interest method of amortizing bond premium. Interest is payable annually on December 31. At December 31, 2005, Wolf's adjusted unamortized bond premium should be Question 9 Earl was engaged by Farm Corp. to perform consulting services. Earl's compensation for these services consisted of 1,000 shares of Farm's $10 par value common stock, to be issued to Earl on completion of Earl's services. On the execution date of Earl's employment contract, Farm's stock had a market value of $40 per share. Six months later, when Earl's