Accounting problem
1. On August 1, 2011, Lane Corporation called its 10% convertible bonds for conversion. The $8,000,000 par bonds were converted into 320,000 shares of $20 par commonstock. On August 1, there was $700,000 of unamortized premium applicable to the bonds. The fair market value of the common stock was $20 per share. Ignore all interestpayments.
2. Packard, Inc. decides to issue convertible bonds instead of common stock. The company issues 10% convertible bonds, par $3,000,000, at 97. The investment bankerindicates that if the bonds had not been convertible they would have sold at 94.
3. Gomez Company issues $5,000,000 of bonds with a coupon rate of 8%. To help the sale, detachable stock warrants are issued at the rate of ten warrants for each$1,000 bond sold. It is estimated that the value of the bonds without the warrants is $4,935,000 and the value of the warrants is $315,000. The bonds with the warrantssold at 101.
Homework Answers
of the unrelated transactions described below, present the entry required to record the bond transactions. (Credit...
of the unrelated transactions described below, present the entry
required to record the bond transactions. (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. Round answers
to 0 decimal places, e.g. 5,275.)
1.
On August 1, 2021, Johnson Corporation called its 10%
convertible bonds for conversion. The $7,000,000 par bonds were
converted into 280,000 shares of $20...
For each of the unrelated situations described below, prepare the entry(ies) required to record t...
For each of the unrelated situations described below, prepare the entry(ies) required to record the transactions. 1. On August 1, 2012, Alpha Corporation called its 10% convertible bonds for conversion. The $4,000,000 par value bonds were converted into 160,000 no par common shares. On August 1, there was $350,000 of unamortized premium applicable to the bonds. At the time of issuance, Contributed Surplus—Conversion Rights was credited for $150,000, which represented the equity portion of the convertible bonds, and the market...
E16-1 (L01,2) EXCEL (Issuance and Conversion of Bonds) For each of the unrelated transactions described below,...
E16-1 (L01,2) EXCEL (Issuance and Conversion of Bonds) For each of the unrelated transactions described below, present the entry (ies) required to record each transaction. 1. Grand Corp. issued $20,000,000 par value 10% convertible bonds at 99. If the bonds had not been convertible, the com pany's investment banker estimates they would have been sold at 95. 2. Hoosier Company issued $20,000,000 par value 10% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value...
E16.1 (LO 1, 2) Excel (Issuance and Conversion of Bonds) For each of the unrelated transac-...
E16.1 (LO 1, 2) Excel (Issuance and Conversion of Bonds) For each of the unrelated transac- tions described below, present the entry(ies) required to record each transaction. 1. Grand Corp. issued $20,000,000 par value 10% convertible bonds at 99. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95. 2. Hoosier Company issued $20,000,000 par value 10% bonds at 98. One detachable stock purchase warrant was issued with each $100 par...
or each of the unrelated transactions described below, present the entries required to record each transaction....
or each of the unrelated transactions described below, present the entries required to record each transaction. 1. Whispering Corp. issued $21,300,000 par value 9% convertible bonds at 97. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95. 2. Metlock Company issued $21,300,000 par value 9% bonds at 96. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling...
For each of the unrelated transactions described below, present the entries required to record each transaction....
For each of the unrelated transactions described below, present the entries required to record each transaction. 1 Pronghorn Corp. issued $20,600,000 par value 9% convertible bonds at 99. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95. Stellar Company issued $20,600,000 par value 9% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for...
For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Nova...
For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Novak Corp. issued $20,300,000 par value 11% convertible bonds at 99. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95. 2. Splish Company issued $20,300,000 par value 11% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling...
For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Tama...
For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Tamarisk Corp. issued $20,100,000 par value 10% convertible bonds at 98. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95. 2. Vaughn Company issued $20,100,000 par value 10% bonds at 97. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling...
Dilutive Securities and EPS Worksheets Part 1: Convertible Securities and Detachable Warrants I. JAMC Corp. issues...
Dilutive Securities and EPS Worksheets Part 1: Convertible Securities and Detachable Warrants I. JAMC Corp. issues $10,000,000 of bonds on May 24, 2018 at a discount of $600,000. Interest on the bonds is payable each October 24 and May 24 Each $1,000 bond (i.e., there were 10,000 issued) is convertible to 20 shares of common stock (par value $3). On October 24, 2022, 2,000 of the bonds are converted. At the time of the conversion, the total remaining unamortized discount...
Exercise 16-1 For each of the unrelated transactions described below, present the entries required to record...
Exercise 16-1 For each of the unrelated transactions described below, present the entries required to record each transaction. Carla Corp. issued $20,100,000 par value 10 % convertible bonds at 98. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95 Sarasota Company issued $20,100,000 par value 10 % bonds at 97. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants...
of the unrelated transactions described below, present the entry
required to record the bond transactions. (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. Round answers
to 0 decimal places, e.g. 5,275.)
1.
On August 1, 2021, Johnson Corporation called its 10%
convertible bonds for conversion. The $7,000,000 par bonds were
converted into 280,000 shares of $20...
E16-1 (L01,2) EXCEL (Issuance and Conversion of Bonds) For each of the unrelated transactions described below, present the entry (ies) required to record each transaction. 1. Grand Corp. issued $20,000,000 par value 10% convertible bonds at 99. If the bonds had not been convertible, the com pany's investment banker estimates they would have been sold at 95. 2. Hoosier Company issued $20,000,000 par value 10% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value...
E16.1 (LO 1, 2) Excel (Issuance and Conversion of Bonds) For each of the unrelated transac- tions described below, present the entry(ies) required to record each transaction. 1. Grand Corp. issued $20,000,000 par value 10% convertible bonds at 99. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95. 2. Hoosier Company issued $20,000,000 par value 10% bonds at 98. One detachable stock purchase warrant was issued with each $100 par...
For each of the unrelated transactions described below, present the entries required to record each transaction. 1 Pronghorn Corp. issued $20,600,000 par value 9% convertible bonds at 99. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95. Stellar Company issued $20,600,000 par value 9% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for...
Dilutive Securities and EPS Worksheets Part 1: Convertible Securities and Detachable Warrants I. JAMC Corp. issues $10,000,000 of bonds on May 24, 2018 at a discount of $600,000. Interest on the bonds is payable each October 24 and May 24 Each $1,000 bond (i.e., there were 10,000 issued) is convertible to 20 shares of common stock (par value $3). On October 24, 2022, 2,000 of the bonds are converted. At the time of the conversion, the total remaining unamortized discount...
Exercise 16-1 For each of the unrelated transactions described below, present the entries required to record each transaction. Carla Corp. issued $20,100,000 par value 10 % convertible bonds at 98. If the bonds had not been convertible, the company's investment banker estimates they would have been sold at 95 Sarasota Company issued $20,100,000 par value 10 % bonds at 97. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants...
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