Homework Answers
| Particulars | Debit | Credit |
|
Cash |
$4,220,000 |
|
| Unamortized bond issuance costs | $30,000 | |
|
Bonds Payable (4,000 X $1,000) |
$4,000,000 |
|
|
Premium on Bonds Payable-Note 1 |
$136,000 |
|
|
Paid-in Capital-Stock Warrants- Note 1 |
$24,000 |
|
|
Bond Interest Expense-Note 2 |
$90,000 |
|
|
(To record the issuance of the bonds) |
||
|
Note 1: |
||
|
Premium on Bonds Payable and Value of Stock Warrants |
||
|
Sales price (4,000 X $1,040) |
$4,160,000 |
|
|
Face value of bonds |
$4,000,000 |
|
|
Deduct value assigned to stock warrants |
||
|
( 4000X 2 =8,000 ; 8,000 X $3) |
$24,000 |
|
|
Premium on bonds payable |
$136000 |
|
|
Note 2 |
||
|
Accrued Bond Interest for 3months |
||
|
Face value of bonds |
$4,000,000 |
|
|
Rate of interest |
9% |
|
|
Interest |
$90,000 |
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Exercise 16-08 On September 1, 2020, Novak Company sold at 104 (plus accrued interest) 5,880 of...
Exercise 16-08
On September 1, 2020, Novak Company sold at 104 (plus accrued
interest) 5,880 of its 8%, 10-year, $1,000 face value,
nonconvertible bonds with detachable stock warrants. Each bond
carried two detachable warrants. Each warrant was for one share of
common stock at a specified option price of $13 per share. Shortly
after issuance, the warrants were quoted on the market for $3 each.
No fair value can be determined for the Novak Company bonds.
Interest is payable on...
Please show all work. Thanks in advance! On September 1, 2020, Metlock Company sold at 104...
Please show all work. Thanks in
advance!
On September 1, 2020, Metlock Company sold at 104 (plus accrued interest) 4,080 of its 10%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Metlock Company...
Please show all work. Thanks in advance! On September 1, 2020, Metlock Company sold at 104...
Please show all work. Thanks in
advance!
On September 1, 2020, Metlock Company sold at 104 (plus accrued interest) 4,080 of its 10%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Metlock Company...
Exercise 16-08 Your answer is partially correct. Try again. On September 1, 2020, Novak Company sold...
Exercise 16-08
Your answer is partially correct. Try again.
On September 1, 2020, Novak Company sold at 104 (plus accrued
interest) 5,880 of its 8%, 10-year, $1,000 face value,
nonconvertible bonds with detachable stock warrants. Each bond
carried two detachable warrants. Each warrant was for one share of
common stock at a specified option price of $13 per share. Shortly
after issuance, the warrants were quoted on the market for $3 each.
No fair value can be determined for the...
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Exercise 16-08
On September 1, 2020, Novak Company sold at 104 (plus accrued
interest) 5,880 of its 8%, 10-year, $1,000 face value,
nonconvertible bonds with detachable stock warrants. Each bond
carried two detachable warrants. Each warrant was for one share of
common stock at a specified option price of $13 per share. Shortly
after issuance, the warrants were quoted on the market for $3 each.
No fair value can be determined for the Novak Company bonds.
Interest is payable on...
Please show all work. Thanks in
advance!
On September 1, 2020, Metlock Company sold at 104 (plus accrued interest) 4,080 of its 10%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Metlock Company...
Please show all work. Thanks in
advance!
On September 1, 2020, Metlock Company sold at 104 (plus accrued interest) 4,080 of its 10%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Metlock Company...
Exercise 16-08
Your answer is partially correct. Try again.
On September 1, 2020, Novak Company sold at 104 (plus accrued
interest) 5,880 of its 8%, 10-year, $1,000 face value,
nonconvertible bonds with detachable stock warrants. Each bond
carried two detachable warrants. Each warrant was for one share of
common stock at a specified option price of $13 per share. Shortly
after issuance, the warrants were quoted on the market for $3 each.
No fair value can be determined for the...
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