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Stone Energy Corporation's 7.5% bonds due in 2022 were reported as selling for 77.00. Were the bonds selling at a premium or at a discount? Why is Stone Energy Corporation able to sell its bonds at this price? The bonds were selling at because the market rate of interest for similar quality bonds was than 7.5%. Alternative Financing Plans Desmond Co. is considering the following alternative financing plans: Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is $896,000. Enter answers in dollars and cents, rounding to two decimal places. Plan 1 Earnings per share on common stock Plan 2 Earnings per share on common stock Journalizing Instaliment Notes On the first day of the fiscal year, a company issues $45,000,8%, seven-year installment notes that have annuai payments of $8,643. The first note payment consists of $3,600 of interest and $5,043 of principal repayment. Entries for Issuing Bonds and Amortizing Discount by Straight-Line Method On the first day of Its fiscal year, Jacinto Company issued $25,000,000 of five-year, 10% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 120 resulting in Jacinto Company recelving cash of $23,159,863. a. Journalize the entries to record the following: 1. Issuance of the bonds. 2. First semiannual interest payment. The bond discount amortization is combined with the semiannual interest payment. 3. Second semiannual interest payment. The bond discount amortization is combined with the semiannual interest payment

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