on jan 1 2018 corporation issued 3million of 8% 5-year convertible bonds at 99. similarly risky...
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on jan 1 2018 corporation issued 3million of 8% 5-year convertible bonds at 99. similarly risky bonds without the conversion featurewere issued at 96. the bonds pay interest on dec 31. each $1000 bond is convertible into 40 shares of common stock. corporation uses the straight line method for any discount/premium amortization. a. they use gaap. prepare the journal entry for dec 31, 2020 interest payment b. they use gaap. on jan 1, 2021 three years after issuing those bonds, bondhilders converted all the bonds into common shares when the share price rose to $45 per sharefor a total market value of 5.4 million. prepare journal entry for the conversion assuming the book value of the liability was 2.948 million on that date and corporation uses the book value method on jan 1 2018 corporation issued 3million of 8% 5-year convertible bonds at 99. similarly risky bonds without the conversion featurewere issued at 96. the bonds pay interest on dec 31. each $1000 bond is convertible into 40 shares of common stock. corporation uses the straight line method for any discount/premium amortization. a. they use gaap. prepare the journal entry for dec 31, 2020 interest payment b. they use gaap. on jan 1, 2021 three years after issuing those bonds, bondhilders converted all the bonds into common shares when the share price rose to $45 per sharefor a total market value of 5.4 million. prepare journal entry for the conversion assuming the book value of the liability was 2.948 million on that date and corporation uses the book value method
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a Assuming the Face value of each convertible as well as non convertible bond is 100 Fol... View the full answer
Related Book For
Financial Accounting and Reporting
ISBN: 978-0273744443
14th Edition
Authors: Barry Elliott, Jamie Elliott
Posted Date:
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