User Account

All Pages

How much should be reported as equity component

Assignment Help Accounting Basics
Reference no: EM133057127

Question - On Jan. 1, 2021, GO Corporation issued P7,500,000 face amount, 5-year bonds at 111. Each P1,000 bond was issued with 50 detachable share warrants, each of which entitled the bondholder to purchase one ordinary share of P5 par value at P30. Immediately after issuance, the market value of each warrant was P10.

The stated interest rate on the bonds is 11% payable annually every Dec. 31. However, the prevailing market rate of interest for similar bonds without warrants is 12%. The present value of 1 at 12% for 5 periods is 0.57 and the present value of an ordinary annuity of 1 at 12% for 5 periods is 3.60.

How much should be reported as equity component arising from the issuance of bonds payable?

How much should be recorded as share premium if all of the warrants are exercised?

Reference no: EM133057127

Questions Cloud

Justification with views of successful worldwide investors : Comment on this phrase and support your justification with views of successful worldwide investors:' While diversification is a good way to preserve wealth, con
Record the receipt and payment of the first interest payment : Record the receipt and payment of the first interest payment on January 1, 2022, for Metlock Inc., and Bridgeport Corp.
What is the first-year debt coverage ratio : You are an employee of University Consultants, Limited, and have been given the following assignment. You are to present an investment analysis of a small retai
Implications for voting-lotteries-certificate issuance : Prepare a paper on the implications for voting, lotteries, certificate issuance, security auditing and enterprise.
How much should be reported as equity component : On Jan. 1, 2021, GO Corporation issued P7,500,000 face amount, How much should be reported as equity component arising from the issuance of bonds payable
What is the expected return of the portfolio : What is the expected return of the portfolio? Do not round intermediate calculations. Round the answer to two decimal places. Fill in the blank 1 %
What is Important for Effective ERM : What are some Key Challenges and Solutions to Implementing an ERM? What is Important for an Effective ERM?
Company weighted average cost of capital : Williams, Inc., has compiled the following information on its financing costs:
What is the new company cost of equity : Company B is financed entirely with Equity. The stock of Company B is publicly traded and has a Beta = 1.0.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare the journal entry to record the declaration

The organization declared a 36% stock dividend. Prepare the journal entry to record the declaration and distribution (on November 1, 2020) of the dividend

  Calculate the budgeted cash receipts for each month

Cash-related production costs are budgeted at $7 per unit produced. Calculate the budgeted cash receipts for each month for Watson Company

  What was the cash balance at the beginning of the month

If the balance of the cash account is $185,000 at the end of the month, what was the cash balance at the beginning of the month

  How do think the bond should be classified in tiny co

Continue to receive and record the interest payments. Given this information, how do you think this bond should be classified in Tiny Co's financial statements?

  Recommendations to improve accuracy of valuation analysis

What are your recommendations to improve the accuracy of valuation analysis? (Alternatively: based on all work done by KKP - do you recommend them to proceed

  Determine an incremental per share effect for shares

Ivanhoe Corporation had net income of $53,700 for the year ended December 31, 2020, Determine an incremental per share effect for 3% preferred shares

  Calculate the amount of taxes that Chuck can deduct

Chuck has AGI of $70,000 and has made the following payments. Calculate the amount of taxes that Chuck can deduct on his itemized deductions

  By what amount should the share premium account increase

On the date of issuance, the share was trading on a public exchange at P140. By what amount should the share premium account increase

  Compute for the total cost of the condominium

Cost of changes during construction to make the condominium more energy efficient 3,000,000. Compute for the total cost of the condominium

  Record the adjusting entry necessary as a direct result

Record the adjusting entry necessary as a direct result of the change as well as any adjusting entry for 2021 related to the situation described

  What amount of these expenditures can holly deduct

After a business meeting with a prospective client, Holly took the client to dinner and the theatre. What amount of these expenditures can holly deduct

  Prepare journal entries to record repayment of the note

Prepare Affiliated Tech's journal entries to record repayment of the note and record the issuance of the note.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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