Glover Corporation issued $3.5 million of 6%, 5-year bonds on January 1, 2017. The bonds were dated

Question:

Glover issued $3.5 million of 6%, 5-year bonds on January 1, 2017. The bonds were dated January 1 and pay interest annually. Glover has a December 31 year end. The bonds are secured with real estate holdings and the bondholder has the option to convert the bonds into common shares. The market interest rate was 7% for these bonds.
Instructions
(a) Describe the features of these bonds.
(b) Calculate the price of the bonds and record the bond issue.
(c) Prepare an effective interest amortization table for these bonds. Round amounts to the nearest dollar.
(d) Journalize the first three interest payments assuming reversing entries have been used.
TAKING IT FURTHER
Why would a bondholder request to have their bonds converted into common shares?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...