Follow the instructions and Prepare journal entries.
Homework Answers
|
Date |
Accounts title and explanation |
Debit |
Credit |
|
Jan. 1, 2020 |
Cash |
428000 |
|
|
Bonds payable |
418319 |
||
|
Contributed surplus – conversion rights |
9681 |
||
|
Dec. 31, 2020 |
Interest expense (418319*3%) |
12550 |
|
|
Bonds payable |
3450 |
||
|
Cash (400000*4%) |
16000 |
||
|
Jan. 1, 2021 |
Bonds payable (418319-3450)*80/400 |
82974 |
|
|
Contributed surplus – conversion rights (9681*80/400) |
1936 |
||
|
Common shares |
84910 |
||
|
Jun. 30, 2021 |
Bonds payable (418319-3450)*80/400 |
82974 |
|
|
Contributed surplus – conversion rights ((9681-1936)*80/320) |
1936 |
||
|
Interest expense ((418319-3450)*3%*6/12*80/320) |
1556 |
||
|
Common shares |
86466 |
||
|
Dec. 31, 2021 |
Interest expense (418319-3450-82974-82974)*3% |
7468 |
|
|
Bonds payable |
2132 |
||
|
Cash (400000-80000-80000)*4% |
9600 |
||
|
Jan. 1, 2022 |
Bonds payable (418319-3450-82974-82974-2132) |
246789 |
|
|
Loss on redemption (249800-246789) |
3011 |
||
|
Contributed surplus – conversion rights (9681-1936-1936) |
5809 |
||
|
Retained earnings (4080-3011) |
1069 |
||
|
Common shares (246789+5809) |
252598 |
||
|
Cash (400-80-80)*17 |
4080 |
Bonds payable = (400000*0.86261)+(400000*4%*4.57971) = 345044+73275 = 418319
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Follow the instructions and Prepare journal entries.
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On January 1, 2020, Bonita Corporation issued a series of 400
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bonds paid interest every December 31 at 6%; the market interest
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were convertible to common shares at a rate of ten common shares
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On January 1, 2019, Concord issued 10-year, $300,000 face value, 6% bonds at par. Each $1,000...
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Problem 16-02 Concord Inc. issued $2,400,000 of convertible 10-year bonds on July 1, 2020. The bonds...
Problem 16-02
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with the issue was $56,400, which is being amortized monthly on a
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Exercise 16-06 Your answer is partially correct. Try again. On January 1, 2020, Sandhill Corporation issued $3,960,000 of 10-year, 7% convertible debentures at 104. Interest is to be paid semiannually on June 30 and December 31. Each $1,000 debenture can be converted into 8 shares of Sandhill Corporation $100 par value common stock after December 31, 2021. On January 1, 2022, $396,000 of debentures are converted into common stock, which is then selling at $111. An additional $396,000 of debentures...
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On January 1, 2018, Madison Products issued $40.3 million of 8%, 10-year convertible bonds at a...
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par common stock. Madison records interest by the straight-line
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On January 1, 2020, Bonita Corporation issued a series of 400
convertible bonds, maturing in five years. The face amount of each
bond was $1,000. Bonita received $439,000 for the bond issue. The
bonds paid interest every December 31 at 6%; the market interest
rate for bonds with a comparable level of risk was 5%. The bonds
were convertible to common shares at a rate of ten common shares
per bond. Bonita amortized bond premiums and discounts using the
effective...
Question 2 --/11 View Policies Current Attempt in Progress On January 1, 2020, Splish Corporation issued a series of 500 convertible bonds, maturing in five years. The face amount of each bond was $1,000. Splish received $524,000 for the bond issue. The bonds paid interest every December 31 at 6%; the market interest rate for bonds with a comparable level of risk was 5%. The bonds were convertible to common shares at a rate of ten common shares per bond....
On January 1, 2019, Concord issued 10-year, $300,000 face value,
6% bonds at par. Each $1,000 bond is convertible into 30 shares of
Concord $2 par value common stock. The company has had 10,000
shares of common stock (and no preferred stock) outstanding
throughout its life. None of the bonds have been converted as of
the end of 2020. (Ignore all tax effects.)
a. Prepare the journal entry Concord would have made on January
1, 2019, to record the issuance...
Problem 16-02
Concord Inc. issued $2,400,000 of convertible 10-year bonds on
July 1, 2020. The bonds provide for 12% interest payable
semiannually on January 1 and July 1. The discount in connection
with the issue was $56,400, which is being amortized monthly on a
straight-line basis.
The bonds are convertible after one year into 8 shares of Concord
Inc.’s $100 par value common stock for each $1,000 of bonds.
On August 1, 2021, $240,000 of bonds were turned in for...
Exercise 16-06 Your answer is partially correct. Try again. On January 1, 2020, Sandhill Corporation issued $3,960,000 of 10-year, 7% convertible debentures at 104. Interest is to be paid semiannually on June 30 and December 31. Each $1,000 debenture can be converted into 8 shares of Sandhill Corporation $100 par value common stock after December 31, 2021. On January 1, 2022, $396,000 of debentures are converted into common stock, which is then selling at $111. An additional $396,000 of debentures...
On January 1, 2018, Madison Products issued $40.3 million of 8%,
10-year convertible bonds at a net price of $41.13 million. Madison
recently issued similar, but nonconvertible, bonds at 98 (that is,
98% of face amount). The bonds pay interest on June 30 and December
31. Each $1,000 bond is convertible into 30 shares of Madison’s no
par common stock. Madison records interest by the straight-line
method.
On June 1, 2020, Madison notified bondholders of its intent to call
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Concord Corporation sold $2,950,000, 9%, 5-year bonds on January 1, 2022. The bonds were dated January 1, 2022, and pay interest on January 1. Concord Corporation uses the straight-line method to amortize bond premium or discount. - Your answer is partially correct. Prepare all the necessary journal entries to record the issuance of the bonds and bond interest expense for 2022, assuming that the bonds sold at 103. (Credit account titles are automatically indented when amount is entered. Do not...
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