ZuoTi.Pro
Question

Coronado Inc. issued $4,660,000 par value, 7% convertible bonds at 96 for cash. If the bonds...

Coronado Inc. issued $4,660,000 par value, 7% convertible bonds at 96 for cash. If the bonds had not included the conversion feature, they would have sold for 95.

Prepare the journal entry to record the issuance of the bonds.

business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1
Account Titles Debit Credit
Cash (4,660,000 x 96%) $ 44,73,600.00
Discount on bonds payable $   1,86,400.00
                  Bonds Payable $ 46,60,000.00
(to record the issuance of the bonds)
1 0
Add a comment
Know the answer?
Add Answer to:
Coronado Inc. issued $4,660,000 par value, 7% convertible bonds at 96 for cash. If the bonds...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Current Attempt in Progress Crane Inc. issued $4,190,000 par value, 7% convertible bonds at 95 for...

    Current Attempt in Progress Crane Inc. issued $4,190,000 par value, 7% convertible bonds at 95 for cash. If the bonds had not included the conversion feature, they would have sold for 95. Prepare the journal entry to record the issuance of the bonds. (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 for the amounts) Account Titles and Explanation Debit Credit

  • Marigold Inc. issued $4,780,000 par value, 7% convertible bonds at 95 for cash. If the bonds...

    Marigold Inc. issued $4,780,000 par value, 7% convertible bonds at 95 for cash. If the bonds had not included the conversion feature, they would have sold for 95. Prepare the journal entry to record the issuance of the bonds. (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 0 for the amounts.) Account Titles and Explanation Debit Credit enter an account...

  • House Hardware Inc. issued 6% convertible bonds on January 1,2015, at 104. The bonds had a...

    House Hardware Inc. issued 6% convertible bonds on January 1,2015, at 104. The bonds had a face value of $500,000 , pay interest semiannually on July 1 and January 1, and mature on January 1, 2025 . Each $1,000 bond can be converted into 50 common shares at any time after January 1, 2017. House's CFO estimates that had the bonds not been convertible , they would have sold for only $375,378 (implies a yield of 10%). On July 2,...

  • Andrew’s Comics issues 10-year semiannual, convertible 5.5% bonds with a face value of €1,250,000. The bonds were issued at 96. Comparable bonds without a conversion feature would have required 8.75%....

    Andrew’s Comics issues 10-year semiannual, convertible 5.5% bonds with a face value of €1,250,000. The bonds were issued at 96. Comparable bonds without a conversion feature would have required 8.75%. What is the market rate of interest on the bonds? Determine how much of the proceeds would be allocated to debt and how much to equity. Give the journal entry to record the issuance under IFRS and the journal entries for the first and second interest payments. You may use...

  • Sunland Inc. issued $6 million of 10-year, 10% convertible bonds on June 1, 2020, at 96...

    Sunland Inc. issued $6 million of 10-year, 10% convertible bonds on June 1, 2020, at 96 plus accrued interest. The bonds were dated April 1, 2020, with interest payable April 1 and October 1. Bond discount is amortized semi-annually. Bonds without conversion privileges would have sold at 95 plus accrued interest. On April 1, 2021, $1.50 million of these bonds were converted into 30,000 common shares. Accrued interest was paid in cash at the time of conversion. Assume that the...

  • ABC Inc issued $6 million of 10-year, 9% convertible bonds on June 1, 2018. These bonds...

    ABC Inc issued $6 million of 10-year, 9% convertible bonds on June 1, 2018. These bonds were issued at 98 plus accrued interest. The bonds were dated April 1, 2018, with interest payable April 1 and October 1. Bond discount is amortized semi-annually. Similar bonds without the conversion privileges would have sold at 97 plus accrued interest. On April 1, 2018, $1.5 million of these bonds were converted into 30,000 common shares. Accrued interest was paid in cash at the...

  • Chips Inc. issued $2,500,000 of convertible 10-year bonds on July 1, 2020. The bonds provide for...

    Chips Inc. issued $2,500,000 of convertible 10-year bonds on July 1, 2020. The bonds provide for 12% interest payable semiannually on January 1 and July 1 and Chips uses effective interest amortization. On the date of issuance, the market rate of interest was 14%. The bonds are convertible after one year into 8 shares of Chips Inc.'s $100 par value common stock for each $1,000 of bonds. On Jan 1, 2022, $250,000 of bonds were turned in for conversion into...

  • On February 1, 2011, Woft Inc. issued 10% convertible bonds dated February 1, 2011, with a...

    On February 1, 2011, Woft Inc. issued 10% convertible bonds dated February 1, 2011, with a face amount of $200,000. The bonds sold for $239,588 and mature in 20 years. Each $1,000 bond is convertible into 60 shares of Wolf's $1 par value common stock. The effective interest rate for these bonds was 8%. Interest is paid semiannually on July 31 and January 31. Wolf's fiscal year is the calendar year. Wolf uses the effective interest method of amortization. 1....

  • Skysong Corporation issues 2,300 convertible bonds at January 1, 2019. The bonds have a 3-year life,...

    Skysong Corporation issues 2,300 convertible bonds at January 1, 2019. The bonds have a 3-year life, and are issued at par with a face value of $1,000 per bond, giving total proceeds of $2,300,000. Interest is payable annually at 6%. Each bond is convertible into 250 ordinary shares (par value of $1). When the bonds are issued, the market rate of interest for similar debt without the conversion option is 7%. 1.Compute the liability and equity component of the convertible...

  • Coronado, Inc. issued 10200 shares of stock at a stated value of $7 per share. The...

    Coronado, Inc. issued 10200 shares of stock at a stated value of $7 per share. The total issue of stock sold for $13 per share. The journal entry to record this transaction would include a debit to Cash for $71400. credit to Common Stock for $71400. credit to Common Stock for $132600. credit to Paid-in Capital in Excess of Par for $132600.

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT