On January 1, 2019, Cai Ltd. issued a 10% convertible bond at par, with a face value
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a. Prepare the journal entry to record the issuance of the convertible debt on January 1, 2019.
b. On January 1, 2022, Cai makes a tender offer to the holder of the convertible debt to repurchase the bond for ¥112,000, which the holder accepts. At the date of repurchase, Cai could have issued non-convertible debt with a 7-year term at an effective-interest rate of 8%. Prepare the journal entry to record this repurchase on January 1, 2022.
Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...
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Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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