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Journal entry for redemption or conversion of bonds

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Reference no: EM13142447

Sigel Corporation retired $130,000 face value, 12% bonds on June 30, 2010, at 102. The carrying value of the bonds at the redemption date was $117,500. The bonds pay semiannual interest, and the interest payment due on June 30, 2010, has been made and recorded.

Diaz Inc. retired $150,000 face value, 12.5% bonds on June 30, 2010, at 98. The carrying value of the bonds at the redemption date was $151,000. The bonds pay semiannual interest, and the interest payment due on June 30, 2010, has been made and recorded.

Haas Company has $80,000, 8%, 12-year convertible bonds outstanding. These bonds were sold at face value and pay semiannual interest on June 30 and December 31 of each year. The bonds are convertible into 30 shares of Haas $5 par value common stock for each $1,000 worth of bonds. On December 31, 2010, after the bond interest has been paid, $20,000 face value bonds were converted. The market value of Haas common stock was $44 per share on December 31, 2010.

Instructions

For each independent situation above, prepare the appropriate journal entry for the redemption or conversion of the bonds. (For multiple debit/credit entries, list amounts from largest to smalest

Reference no: EM13142447

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