Question

Wiley CPAexcel Con- tinued Access - Your answer is partially correct. Discussions Conferences Grouper Inc. has decided to raise additional capital by issuing $176,000 face value of bonds with a coupon rate of 11%. In discussions with investment bankers, it was determined that to help the sale of the bonds, detachable stock warrants should be issued at the rate of one warrant for each $100 bond sold. The value of the bonds without the warrants is considered to be $130,500, and the value of the warrants in the market is $14,500. The bonds sold in the market at issuance for $157,500. Collaborations WileyPLUS Support (a) What entry should be made at the time of the issuance of the bonds and warrants? (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. Round intermediate calculations to 5 decimal places, e.8. 1.24687 and final answers to 0 decimal places, e.g. 5,125.) Account Titles and Explanation Debit Credit Cash 157500 Discount on Bonds Payable Bonds Payable 176000 Paid-in Capital-Stock Warrants (61) Prepare the entry if the warrants were nondetachable. (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. Round intermediate calculations to 5 decimal places, e.g. 1.24687 and final answers to 0 decimal places, e.g. 5,125.) Account Titles and Explanation Debit Credit Cash 157500 Discount on Bonds Payable 18500 Bonds Payable 176000 Attempts. 1 of 3 used Darvast with Mewaluer

Answer 1

solution a) Debit Gredet 157500 34250 | Account titles and explanation Cash Discount on bonds payable Bonds payable pold in capital stock - warrante 157500 / (130500+ 14500) x 14500 196000 15750

.. Debit Gredet Account title we explanation. cash Biscount on bonds payable Bonds payable . 157500 18500 176000