Question

Modules Grades Question 9 0.92/1 Wiley Accounting Weekly Updates View Policies Show Attempt History Current Attempt in Progress Student Practice and Solutions Manual Wiley CPAexcel Con- tinued Access - Your answer is partially correct. Discussions Marin Corporation has outstanding 2,100 $1,000 bonds, each convertible into 40 shares of $10 par value common stock. The bonds are converted on December 31, 2020. when the unamortized discount is $37,500 and the market price of the stock is $21 per share. Conferences Collaborations Record the conversion using the book value approach. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Wiley PLUS Support Account Titles and Explanation Debit Credit Bonds Payable 2100000 Discount on Bonds Payable 37500 Common Stock 840,000 Paid-in Capital in Excess of Par - Common Stock 877500 Attempts: 1 of 3 used Repeat with New Values Send to Gradebook < Prev Next > Previous Next

Answer 1

Credit to Paid-in Capital in Excess of Par - Common Stock should be $1,222,500, which is arrived as mentioned below Bonds Payable Less: Discount on Bonds Payable Less: Common Stock Paid-in Capital in Excess of Par - Common Stock $ $ $ $ 2,100,000 (37,500) (840,000) 1,222,500 Hence, the journal entry should be as follows- Debit Credit $ 2,100,000 Account Titles and Explanation Bonds Payable Discount on Bonds Payable Common Stock Paid-in Capital in Excess of Par - Common Stock $ 37,500 $ 840,000 $ 1,222,500