FREE Trial

On July 1, 2007 Salem Corporation issued $3 million of 12% bonds payable in 10 years. The bonds pay interest semiannually. The bonds include detachable warrants giving the bondholder the right to purchase for $30, one share of $1 par

On July 1, 2007 Salem Corporation issued $3 million of 12% bonds payable in 10 years. The bonds pay interest semiannually. The bonds include detachable warrants giving the bondholder the right to purchase for $30, one share of $1 par value common stock at any time during the next 10 years. The company sold the bonds for $3 million. The value of the warrants at the time of issuance was $200,000.

Required
Prepare in general journal format the entry to record the issuance of the bonds.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... 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... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...

This problem has been solved!


Do you need an answer to a question different from the above? Ask your question!
  • Tutor Answer

Cash 3 000 000 Discount on Bonds Payable 200 000 Bonds Payable …View the full answer


answer-question
Related Book For  answer-question
Intermediate Accounting

Intermediate Accounting

ISBN: 978-0324300987

10th Edition

Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones

See More Books
Question Details
Chapter # 14
Section: Exercises
Problem: 17
Posted Date: March 12, 2012 03:55:16
See More Questions

Students also viewed these Accounting questions

Q:
a common sugar in the cell is shown below.what sugar is it?which functional group will be involved in the formation of a polymer? please circle it CH2OH KH H OH Q H H
A:
What Sugar is it Ribose Which funcional group will be in......
Q:
Century Corporation issued 800,000 shares of $10 par value common stock at the time of its incorporation. The stock was issued for cash at a price of $13 per share. During the first year of...
A:
ANSWER b 4 380 000 Number of stock 400 000 shares Value of each......
Q:
Rainbow manufactures wooden backyard playground equipment. Rainbow estimated $1,785,000 of manufacturing overhead and $2,100,000 of direct labour cost for the year. After the year was over, the...
A:
Req 1 Predetermined manufacturing overhead rate 1 785 000 2 100 000 of direc......
Q:
The post-closing trial balance of Storey Corporation at December 31, 2017, contains the following stockholders' equity accounts. Preferred Stock (15,500 shares issued)...
A:
Cash dividend bifercation Preferred dividend 2016 42900 2017 42900 Common D......
Q:
The circuit in Fig. 2.134 is to control the speed of a motor such that the motor draws currents 5 A, 3 A, and 1 A when the switch is at high, medium, and low positions, respectively. The motor can be...
A:
With the switch in high position 6 0 01 R 3 0......
Q:
The cause of a risk event is usually referred to as: A. An opportunity B. A hazard C. An outcome D. An unwanted surprise
A:
B......
Q:
Connors Shoe Company is contemplating the acquisition of Salinas Boots, a firm that has shown large operating tax losses over the past few years. As a result of the acquisition, Connors believes that...
A:
a Years Earnings Tax Liability After Tax Earnings 1 15 280 0......
Q:
Kamper Company, a Canadian public corporation, acquired the shares of Marto Limited, a Canadian privately owned corporation, on July 1, 2022, from an arms-length seller. Marto Limited is a...
A:
a Income Tax Implications for Marto Limited of the Acquisition by Kamper Company Change in Ownership The acquisition by Kamper Company represents a ch......
Q:
One of the tennis rackets that Ace Sporting Goods manufactures is a titanium model (Slam) that sells for $149. The cost of each Slam consists of: Materials . . . . . . . . . . . . . . . . . . . . . ....
A:
1 a Work in Process 7 500 Materials 3 500 Payroll 1 500 F......
Q:
Conroe Corporation sold $500,000 of 13% bonds at 107. Each $1,000 bond carried 20 warrants, and each warrant allowed the holder to acquire one share of $10 par value common stock for $20 per share....
A:
1 Value Assigned to Bonds x 535 000 496 091 4 x 500 x 20 Value Assigned to Warrants 1......
Q:
On January 1, 2007 the Johnson Corporation issued a two-year note due December 31, 2008, with a face value of $10,000, receiving $7,694.68 in exchange. Required Prepare the journal entries to account...
A:
1 2007 Jan 1 Cash 7 694 68 Discount on Notes Payable 2 305 32 Notes Payable 10 000 00 2 2......
Q:
Will a liability be recognized in relation to a cash-settled share-based payment transaction and, if so, does the liability need to be remeasured at the end of each reporting period?
A:
Yes for a cash settled share based payment transaction a liability will be recogn......
Q:
Which of the following, occurring after the Balance Sheet date, is an adjusting event? A. A capital reconstruction B. A debtor at the Balance Sheet date subsequently becoming bankrupt C. An issue of...
A:
An adjusting event is an event that provides additional information about th......
Q:
FRS 18 (Accounting policies) lists four accounting principles. Which of the following is stated by the standard to be a desirable principle? A. Accruals B. Consistency C. Going concern D. Historical...
A:
The desirable principle mentioned in FRS 18 Accounti......
Q:
Which of the following is required by FRS 4 (Capital instruments) to be disclosed by way of a note to the accounts? A. Exceptional items B. The basis on which depreciation has been calculated C. The...
A:
FRS 4 Capital instruments requires the following to be d......
Q:
On which amount are earnings per share calculated? A. Profit after interest, tax and preference dividend B. Profit after interest, tax, preference dividend and transfer to general reserve C. Profit...
A:
Earnings per share EPS is typically calculated on the......
Q:
SSAP 25 (Segmental reporting) requires companies to give separate figures for certain items for each segment. For which of the following are separate figures not required? A. Cost of sales B. Net...
A:
Under SSAP 25 Segmental reporting companies are generally re......
Q:
Find the indefinite integral. Use a computer algebra system to confirm your result. sec t cost - 1 dt
A:
To evaluate the integral we use the substitution u......
Q:
Hotel Majestic is interested in estimating fixed and variable costs so that the company can make more accurate projections of costs and profit. The hotel is in a resort area that is particularly busy...
A:
a Depreciation of the building fixed b Salaries of restaurant staff mixed a minimum num......
Q:
In this simulation, you are asked to address questions related to the accounting for leases. Prepare responses to allparts. KWW Professlonal Simulation Accounting Time Remaining for Leases 2 hours 00...
A:
Resources This lease is a capital lease to the lessee because the lease term six years exceeds 75 of the economic life of the asset six years Also the......
Q:
In this simulation, you are asked to address questions related to the accounting for leases. Prepare responses to all parts. (Round amounts to the nearestcent.) KWW Professional Simulation Time...
A:
Explanation This is a capital lease to Dexter Labs since the lease t......
Q:
Briefly describe some of the similarities and differences between GAAP and IFRS with respect to the accounting for leases.
A:
Both U S GAAP and IFRS share the same objective of recording leases by lessees......
Q:
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
A:
1040 of the sury Internal Reverse Service For the year Jan 1 Dec 31 2012 or other tax your beginning Your first name and initial Ivan 1 If a joint return spouse s first name and initial Incisor Irene......
Q:
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
A:
A hotel s target market is a specific subset of all hotel customers from whom a particular property seeks to obtain business This could be business travelers and families on vacation to a hotel near a......
Q:
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
A:
Answer 12 A A bond s coupon rate sometimes abbreviated simply to coupon isn t affected by its price B However the coupon rate influences the bond s price by influencing the bond s competitiveness and......
Q:
A cardboard tube is wrapped with two windings of a insulated wire wound in opposite directions, as shown in Fig. 29.34. Terminals a and b of winding A may be connected to a battery through a...
A:
IDENTIFY Apply Lenzs law SET UP The field of the induced current is directed to oppose the change in......
Q:
What mistakes are first-time exporters most likely to make?
A:
First timer exporters may fall victim to a series of mistakes Failure to obtain qualified export cou......
Q:
Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2...
A:
1 Sales 15 000 units 70 per unit 1 050 000 Variable expenses 15 000 units 40 per unit 600 000 Contri......
Q:
When possible, compute the truth values of the simple components in the following compound propositions. If no truth value can be computed, write a question mark (?) under the letter or letters with...
A:
Click to View...
Q:
For each case in the accompanying table, answer the questions that follow. a. Calculate the future value of the annuity assuming that it is (1) An ordinary annuity. (2) An annuity due. b. Compare...
A:
a Future value of an ordinary annuity vs annuity due 1 Ordinar......
Q:
Which company is most likely to have the highest share of systematic risk out of its total risk? Standard error AAA BBB CCC DDD Beta 1.93 1.19 1.19 1.06 R2 0.47 0.23 0.94 0.22 1.45 1.27 1.46 1.19
A:
Systematic risk often measured by beta represents t......
Q:
Make the given changes in the indicated examples of this section and then solve the resulting equations. In Example 3, change the 2 to 6 and then solve the equation. Data from Example 3 Solve the...
A:
If we change the 2 to 6 then the equation will be x x 6 0 By letting y......
Q:
In Example 3, change the 8 under the radical to 19. Data from Example 3 Solve the equation Cubing both sides of the equation, we have Checking this solution in the original equation, we get...
A:
To change the 8 under the radical to 19 we simply replace it in the o......
Q:
Why is it important to organizationally separate the accounting function from other functions of the organization?
A:
The accounting function provides record keeping services for all of the operations and......
Q:
How have you personally used observational research?
A:
I have not personally used observational research in the traditional sense as I am a large language......
Q:
Mountain Dew is an established brand in a mature product category. Which methods of allocating advertising fundspercentage of sales, share of market/share of voice, objective/task, or empirical...
A:
For a mature brand like Mountain Dew a combination of advertising budget allocation methods is often......
Q:
For Dove, as for many beauty products, packaging is extremely important. Dove beauty bars are typically packaged in elegant, simple packages that feature Doves trademark white and blue colors (you...
A:
To tie the Dove beauty bars to the Real Beauty campaign on their packaging Unilever should consider including certain information while avoiding other......
Q:
What is the advantage of magazine advertising to businesses that sell to other businesses?
A:
Magazine advertising can offer several advantages to businesses that sell to other businesses B2B Here are some of the key benefits Targeted Audience......
Q:
If the Partnership for a Drug-Free America asked Goodby, Silverstein & Partners to come up with a corresponding radio complement to their pro bono TV campaign, what would Goodby want to keep in mind...
A:
When converting a concept from a TV campaign to a radio format Goodby Silverstein Partners would wan......
Q:
How is the equilibrium exchange rate determined?
A:
The equilibrium exchange rate is the point......
Q:
a) Show that (a, b) := {{a}, {b}} does not satisfy the ordered pair axiom. b) Determine whether each of the following statements is true or false. (Give a reason in each case): (i) {a, b} C (a, b)....
A:
Click to View...
Q:
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
A:
1040 of the sury Internal Reverse Service For the year Jan 1 Dec 31 2012 or other tax your beginning Your first name and initial Ivan 1 If a joint return spouse s first name and initial Incisor Irene......
Q:
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
A:
Answer 12 A A bond s coupon rate sometimes abbreviated simply to coupon isn t affected by its price B However the coupon rate influences the bond s price by influencing the bond s competitiveness and......
Q:
As described in the chapter, the abnormal earnings approach for estimating common share value is where P0 is the total value of all outstanding shares, BV0 is the current book value of stock-holders...
A:
Requirements 1 and 2 The template solution shown on the next page yields an estimated stock price of 35 74 per share This estimate is considerably bel......
Q:
Why have some firms gone to voluntary benefits as opposed to discretionary benefits?
A:
As firms search for ways to reduce costs many organizations are movin......
Q:
Claim: p 1 = p 2 ; = 0.05. Sample statistics: x 1 = 425, n 1 = 840 and x 2 = 410, n 2 = 760 Determine whether a normal sampling distribution can be used. If it can be used, test the claim about the...
A:
p x 1 x 2 n 1 n 2 425 410 840 760 0 522 q 1 p 0 478 n 1 p 840 0 522 438 48 5 n 1 q 840 0 4......
Q:
Refer to Question 15. How does the tax code attempt to remedy this seeming inequity? Data from 15 Explain why self-employed taxpayers generally pay double the amount of FICA taxes that regular wage...
A:
Self employed taxpayers are all......
Q:
Interpret the following symbolized arguments in light of the eight argument forms presented in this section. In some cases a symbolized argument must be rewritten using commutativity or double...
A:
Click to View...
Q:
a. Using the DOT PROJECT Table, describe an example that illustrates the insertion anomaly. b. Using the DOT PROJECT Table, describe an example that illustrates the deletion anomaly. c. Using the DOT...
A:
a You cannot add a new add a new county 5 Cook without adding a project associated with it b......
Q:
A 10-kHz AM broadcast signal covering 895-905 kHz radio frequency (RF) range is to be down-converted to an intermediate frequency (IF) range of 395-405 kHz where main amplification takes place in AM...
A:
To down convert the 10 kHz AM broadcast signal from the 895 905 kHz radio frequency RF range to an i......
Q:
Crystal Exporting Co. is a U.S. wholesaler engaged in foreign trade. The following transactions are representative of its business dealings. The company uses a periodic inventory system and is on a...
A:
Part A Dec 1 Purchases 26 565 Accounts Payable 210 000 x 1265 26 565 1 FC Receivable from Exchange D......
Q:
Kuratowski gave the following definition of an ordered pair: (a, b) = {{a}, {a,b}}. a) Show: for all objects a1, a2, b1,b2, we have (a.b) = (a2, b) exactly when a = a2 and b b. Thus Kuratowski's...
A:
Click to View...
Q:
ABC Ltd. is in the toy manufacturing business.The firm plans to develop a new toy.The firm may purchase or lease the necessary machinery.The machine can be purchased for Rs.60,000,000.It is expected...
A:
Here is an Excel table that calculates the present value of cash flows for both options and compares......
Q:
Consider the iquid-level control system shown in Fig. P12-4. The tanks are noninteract- ing. The foll wing information is known: The esistances on the tanks are linear. These resistances were tested...
A:
Click to View...
Q:
Emmanuel likes gardening. He grows zucchini that he sells at the local farmers' market. The table below describes the benefits and costs Emmanuel faces as he decides how many hours to dedicate to his...
A:
Marginal benefits total benefits Hours spent Marginal cost......
Q:
Relenta Company reported an after-tax net profit of Rs. 3,17,000 for 2022. On April 1, 2021 the company had 96000 equity shares of Rs.10 par value and 1000 of 12%, Rs.100 convertible cumulative...
A:
To calculate the basic and diluted earnings per share EPS for Relenta Company for the year 2022 we need to follow these steps Calculate the weighted a......
Q:
a) The spot price of gold is $1,200 per ounce. The storage costs are $ 2.7 per ounce, to be paid once in 8 months' time. The futures contract on gold has 1 year and 4 months to maturity, and the...
A:
a To calculate the futures price per ounce of gold F we ll use the cost of carry model for commoditi......
Q:
CCC is a firm with no debt and its annual cash flow is $140 million before interest and taxes. The corporate tax rate is 35% and the discount rate is 10%. The firm has a plan to exchange 50% of its...
A:
I The firm should not do the plan i Under MM propositions the value of the firm is independent of it......
Q:
Michelle's active cash flow management revealed a short term investment opportunity in the next 30 days. She will have $3 Million excess cash for a period of 60 days. She is planning to invest in a...
A:
To estimate the net hedge position we need to calculate the change i......
Q:
R&B Co. Ltd. is planning to build market stores on a Build-Operate-Transfer (BOT) arrangement for the Sunyani Municipal Assembly. The total cost of the project is estimated at GH 450, 650.00. The...
A:
a With a detailed numerical analysis explain the financial justification for this investment given that Go G s one year Treasury bill rate is 24 p a A......
Q:
An access route is being constructed across a field (Figure Q8). Apart from a relatively firm strip of ground alongside the field's longer side AB, the ground is generally marshy. The route can...
A:
Let ACEX BC 50 X CD Let rete of coustruition......
500 SAT Math Questions To Know By Test Day 4th Edition - ISBN: 978-1264277803 - Free Book