Brief Exercise 16-1 Archer Inc. issued $3,808,100 par value, 7% convertible bond

Question

Brief Exercise 16-1

Archer Inc. issued $3,808,100 par value, 7% convertible bonds at 97 for cash. If the bonds had not included the conversion feature, they would have sold for 95.

Prepare the journal entry to record the issuance of the bonds

Brief Exercise 16-1

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Archer Inc. issued $3,808,100 par value, 7% convertible bonds at 97 for cash. If the bonds had not included the conversion feature, they would have sold for 95.

Prepare the journal entry to record the issuance of the bonds

Explanation / Answer

Journal entry :

Date accounts & explanation debit credit Cash (3808100*97/100) 3693857 Discount on Bonds payable 114243     Bonds payable 3808100 (To record convertible bonds issue)

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