On July 1 Salem Corporation Issued 1 600 000 Of 7 Bonds Due In 10 Years The Bonds Pay Cash Interest Semiannually Ea 1 (251.5 KiB) Viewed 27 times
On July 1 Salem Corporation Issued 1 600 000 Of 7 Bonds Due In 10 Years The Bonds Pay Cash Interest Semiannually Ea 2 (65.17 KiB) Viewed 27 times
On July 1, Salem Corporation issued $1,600,000 of 7% bonds due in 10 years. The bonds pay cash interest semiannually. Each $1,000 bond includes a detachable stock purchase warrant. Each warrant gives the bondholder the right to purchase, for $30, one share of $1 par value common stock at any time during the next 10 years. The bonds were sold at 101. The value of the stock purchase warrants at the time of issuance was $80,000. The bonds would sell without warrants at $ $1,552,000. a. Record the entry for issuance of bonds using the proportional method. Notrwall animale in calation and the final answer to the nearest dollar, ✓ Cash Inventory Dat Equipment Debit Credit Land July + Deferred Revenue Bonds Payable Discount on Bonds Payable Discount and Debt Issuance Costs Premium on Bonds Payable Fair Value Adjustment-Bonds Payable Note Payable b. R Discount on Note Payable nstead that the warrants are not detachable. Premium on Note Payable Fair Value Adjustment—Note Payable Dat Interest Payable Debit Credit July Common Stock Paid-in Capital in Excess of Par-Common Stock Paid-in Capital-Stock Warrants Date Retained Earnings-Prior Period Adjustment Debt Conversion Expense Interest Expense Loss on Redemption of Bonds Gain on Redemption of Bonds Unrealized Gain or Loss-Income Unrealized Gain or Loss-OCI Next
On July 1, Salem Corporation issued $1,600,000 of 7% bonds due in 10 years. The bonds pay cash interest semiannually. Each $1,000 bond includes a detachable stock purchase warrant. Each warrant gives the bondholder the right to purchase, for $30, one share of $1 par value common stock at any time during the next 10 years. The bonds were sold at 101. The value of the stock purchase warrants at the time of issuance was $80,000. The bonds would sell without warrants at $ $1,552,000. a. Record the entry for issuance of bonds using the proportional method. Note: Carry all decimals in calculations; round the final answer to the nearest dollar. Account Name Debit Credit Date July 1 + To record bond issuance. b. Record the entry for issuance of bonds assuming instead that the warrants are not detachable. Account Name Debit Credit Date July 1 To record bond issuance,
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