rlacial Virgin Ga /1195685/assignments/6850184 CCOUNTING II Assignments Chapter
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rlacial Virgin Ga /1195685/assignments/6850184 CCOUNTING II Assignments Chapter 16 WileyPLUS homework leyPLUS homework Kieso, Intermediate Accounting, 16e Help I Exercise 16-1 For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Pina Corp issued$19,500,000 par value 11% convertible bonds at 98. If the bonds had not been vertible, to co nai 2. 3. Suppose investment banker estimates they would have been sold at 95. Grouper Company issued $19,500,000 par value 1 1% bonds at 97. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for $5. Sepracor, Inc. called its convertible debt in 2017, Assume the following related to the transaction. The 12% unamortized discount applicable to the bonds, and the company paid an additional $82,000 to the s were converted into 1,050,000 shares of $1 par value common stock on July 1, 2017. On July 1, $10,500,000 par value bond 10,57.of unortized discount applicable to the bonds, and the company paid an addtiod. bondholders to induce conversion of all the bonds. The company records the conversion using the book value method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) No. Account Titles and Explanation Debit Credit 327 PMExplanation / Answer
1. Cash A/c ($19500000/100*95) 185,25,000
Discount on Bond Payable A/c ($19500000/100*5) 975000
To Bonds Payable A/c 195,00,000
2. Cash A/c ($19500000/100*97) 189,15,000
Discount on Bond Payable A/c (balancing fig.) 1560000
To Bonds Payable A/c 195,00,000
To Additional Paid in Capital Stock warrant 975,000
($195,00,000/100*5)
Value of the Bond and Warrant $189,15,000
Less: Warrant Value 975000
Value of Bond $17,940,000
3. Bond Payable 10,500,000
Debt Conversion Expense 82,000
To Discount on Bonds Payable 57,000
To Common Stock 1,050,000
To APIC-Common Stock 9,393,000
(10,500,000 - 1,050,000 - 57,000)
To Cash 82,000
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