On March 1, 2016, Doll Co issued 10 year convertible bonds at 106 During 2019, the bonds were converted into common stock when the market price of Doll 's common stock was 500 percent above its par value On March 1, 2016, cash proceeds from the issuance of the convertible bonds should be reported a...

The correct option is Option a A liability for the entire proceeds Explanation At t ...

On March 1, 2016, Doll Co. issued 10-year convertible bonds at 106. During 2019, the bonds were

Question:

On March 1, 2016, Doll Co. issued 10-year convertible bonds at 106. During 2019, the bonds were converted into when the market price of Doll's was 500 percent above its par value. On March 1, 2016, cash proceeds from the issuance of the convertible bonds should be reported as:
a. A liability for the entire proceeds.
b. Paid-in capital for the entire proceeds.
c. Paid-in capital for the portion of the proceeds attributable to the conversion feature and as a liability for the balance.
d. A liability for the face amount of the bonds and paid-in capital for the premium over the par value. Answer:
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...