Question: Branson Corporation issued 500 000 of convertible bonds at par value
Branson Corporation issued $500,000 of convertible bonds at par value. The bonds were issued with a stated interest rate of 3%. Each $1,000 bond is convertible into 20 shares of the corporation's $1 par value common stock. Branson may also elect to settle bonds with a cash payment in lieu of issuing stock. Similar bonds without the conversion feature would have sold for $455,000. Prepare the journal entry' for Branson to record the issuance of the convertible bonds.
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