Question: urgent plzz help!! Question 2 (30 marks) Part A (14 marks) On 1 January 2019, Lin Company issued a convertible bond with a par value
Question 2 (30 marks) Part A (14 marks) On 1 January 2019, Lin Company issued a convertible bond with a par value of $100,000 in the market for $120,000. (i) The bonds are convertible into 12,000 ordinary shares with a par value of $1 per share. (ii) The bond has a 5-year life and has a stated interest rate of 10%. (iii) Interest payment will be made annually on 31 December, starting from 31 December 2019. (iv) The market interest rate for a similar non-convertible bond is 8%. The following bond amortization schedule is provided for the liability component of the bond. Date Cash Paid Interest Expense Premium Amortized 1/1/19 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 $ 10,000 10,000 10,000 10,000 10,000 $ 8,639 8,530 8,412 8,285 8,148 $ 1,361 1,470 1,588 1,715 1,852 Carrying Amount of Bonds $ 107,986 106,625 105,155 103,567 101,852 100,000 Required: (Support with detailed calculations.) Al. Prepare the journal entry to record the issuance of the convertible bond on 1 January 2019. (6 marks) 42. Assume that Lin Company repurchased the convertible bond on 31 December 2021 for $111,000 On 31 December 2021, the fair value of the liability component of the bond was $108,000. Lin Company already recorded the interest related to the bonds in 2021. Prepare the journal entries to record the repurchase of the bonds on 31 December 2021. (8 marks)
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