On December 31,2009,the Balance Sheet of the Gable Corporation Reported
On December 31,2009,the balance sheet of the Gable Corporation reported 1,000 bonds outstanding with a face value of $500,000 and a related unamortized discount of $35,000.The bonds are convertible at the rate of 25 shares of common stock for each $1,000 bond.On January 1,2010,the bondholders presented $400,000 of the bonds for conversion.The entry to record this conversion contained a credit to Additional Paid-in Capital for $172,000.Calculate the par value per share of the common stock.
When bonds are converted to common stock,what is the basis for recording (valuing)the stock issued?
On July 1,20xx,Benchley Corporation issued bonds with a face value of $600,000.The bonds carry a face interest rate of 8 percent that is payable each June 1 and December 1.
a. Prepare an entry in journal form without explanations to record the issuance assuming the bonds are issued at 100.
b. Prepare an entry in journal form without explanations to record the issuance assuming the bonds are issued at 97.
c. Prepare an entry in journal form without explanations to record the issuance assuming the bonds are issued at 103.
Strathern Corporation issued ten-year term bonds dated January 1,2009,with a face value of $800,000.The face interest rate is 10 percent,and interest is payable semi-annually on June 30 and December 31.The bonds were issued for $708,400 to yield an effective annual rate of 12 percent.Use the effective interest method of amortization.Round answers to the nearest dollar.
a. Prepare entries in journal form without explanations to record the bond issue on January 1, 2009, and the payments of interest and amortization on June 30 and December 31, 2009.
b. Calculate the total amount to be reported as Bond Interest Expense on the income statement for the year ended 2010.
c. Calculate the carrying value of the bonds on December 31, 2010.