On January 1, 2014, MacGregor Ltd. issued 1,000 3-year, 5% convertible bonds at par of $1,000, with
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On January 1, 2014, MacGregor Ltd. issued 1,000 3-year, 5% convertible bonds at par of $1,000, with interest payable each December 31. Each bond is convertible into 100 common shares, and the current fair value of each common share is $8 per share. Similar straight bonds carry an interest rate of 9%.
(a) Calculate the PV of the debt component by itself.
(b) How should MacGregor record the issuance if it follows IFRS?
(c) How should MacGregor record the issuance if it follows ASPE?
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a PV annuity 3 years 9 50000 126565 PV 1000000 in 3 years 9 772180 PV of the debt co...View the full answer
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Related Book For 
Intermediate Accounting
ISBN: 978-1118300855
10th Canadian Edition Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy
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