How much is the gain or loss on retirement taken to profit

Assignment Help Financial Accounting
Reference no: EM132998738

Problem 1: On December 31, 2021, PISTACHIO Company had outstanding ?20 million face value convertible bonds maturing on December 31, 2024. Interest is payable annually on December 31. Each ?1,000 bond is convertible into 60 shares of PISTACHIO's ?P10 par ordinary shares. The unamortized premium balance on December 31, 2021 is ?350,000. The balance of Share premium arising from bond conversion privilege is ?640,000. On this date, assume that on December 31, 2021, PISTACHIO retired the ?2,000,000 issue at 103. Without the conversion privilege, these bonds would have been sold at 102. How much is the gain or loss on retirement taken to profit or loss?

Option 1: ? 5,000 LOSS

Option 2: ? 25,000 LOSS

Option 3: ? 25,000 GAIN

Option 4: ? 20,000 GAIN

Reference no: EM132998738

Questions Cloud

Discuss the typical raw materials used by pepsico : Discuss the typical raw materials used by PepsiCo and Johnson and Johnson. Discuss the types of processes used by PepsiCo and Johnson and Johnson.
Discuss the key internal control weaknesses : Lisa is a highly competent employee of the XYZ Ltd. Discuss the key internal control weaknesses that permitted the defalcation to occur in XYZ Ltd
Prepare journal entries to record instalment note payable : Prepare journal entries to record 1) the instalment note payable on the date of issue, and 2) the entry for the first instalment payment
Calculate NPV of Project Comfy Shoes : A feasibility study is undertaken at a cost of $1,000. Calculate NPV of Project Comfy Shoes. Should you accept or reject the project? Why
How much is the gain or loss on retirement taken to profit : Without the conversion privilege, these bonds would have been sold at 102. How much is the gain or loss on retirement taken to profit or loss?
Discuss the ramifications of competency to stand trial : Discuss the ramifications of competency to stand trial for someone claiming intellectual disability using the Dusky standard. Do you believe there
Determine the cost of bonds : Company X issues 11% bonds of INR. 100 for an amount aggregating INR. 200,000 at 10% premium, redeemable at par after 5 years. Determine the cost of bonds
What is the amount credited to share premium upon conversion : When the market value of PISTACHIO's ordinary share was ?18. What is the amount credited to share premium upon conversion of the bonds?
Find the duration d and the modified duration dm : Find the duration D and the modified duration DM of a perpetual annuity that pays an amount twice a year, with the first such payment being six months from now.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Record the transactions in Crane Company books

Record the transactions in Crane Company books - July 31 Crane did a physical count and determined there was $10,500 of inventory on hand

  Analyze the ethical dilemma presented

The management of the Auto Parts Division of the Santana Corporation receives a bonus if the division's income achieves a specific target. For 2013 the target will be achieved by a wide margin. Use the following model to analyze the ethical dilemma p..

  Describe the methods of revenue recognition

Describe the methods of revenue recognition and GAAP method of revenue recognition fulfills the needs of the International Financial Reporting System?

  Identify the major investing and financing activities

Identify the major investing and financing activities undertaken in the last financial year Fiji TV 2018. How do these major activities

  How much will have at retirement in thirty years

How much will have at retirement in 30 years if your IRA earns 8% APR, compounded quarterly? If you set aside $3,600 per year (i.e., one deposit of $3,600)

  Calculate net cash flows from operating activities

Accounts Payable decreased by $14,000, and Accrued Liabilities decreased by $1,700. Use the indirect method to determine net cash flows from operating activities.

  How much should cano report as foreign exchange transaction

Cano's year-end, the spot rate was $.19, but the rate increased to $.22 by February 1, year 2, when payment was received. How much should Cano report

  Calculate the firms cash conversion cycle

Calculate the firms cash conversion cycle, its daily cash operation expenditure and the amount of resources needed to support its cash conversion cycle.

  Present value and break-even interest

Consider a firm with a contract to sell an asset for $135,000 three years from now. The asset costs $89,000 to produce today. Given a relevant discount rate on this asset of 13 percent per year, will the firm make a profit on this asset?

  Prepare separate depreciation schedules for the machinery

Boscan Corporation purchased machinery on January 1, 2014, at a cost of $345,000. The estimated useful life of the machinery is 4 years, with an estimated salvage value at the end of that period of $28,900. Prepare separate depreciation schedules for..

  Amount reported for total liabilities and stockholders

What is the amount reported for total liabilities and stockholders' equity on December 31?

  Does disney use the direct method or the indirect method

Does Disney use the direct method or the indirect method? Explain. Analyze Disney's overall cash flow picture for 2009, 2010, 2011 in light of the positive or negative cash flow patterns for the three categories of cash flows. In the notes to Disney'..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd