Prepare the journal entries for the issuance of the bonds

Assignment Help Accounting Basics
Reference no: EM131740799

Question: On January 1, 2016, Gless Textiles issued $16 million of 9%, 20-year convertible bonds at 101. The bonds pay interest on June 30 and December 31. Each $1,000 bond is convertible into 40 shares of Gless's no par common stock. Bonds that are similar in all respects, except that they are nonconvertible, currently are selling at 99 (that is, 99% of face amount). Century Services purchased 15% of the issue as an investment.

Required: 1. Prepare the journal entries for the issuance of the bonds by Gless and the purchase of the bond investment by Century. (Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

2. Prepare the journal entries for the June 30, 2020, interest payment by both Gless and Century assuming both use the straight-line method. (Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

3. On July 1, 2021, when Gless's common stock had a market price of $33 per share, Century converted the bonds it held. Prepare the journal entries by both Gless and Century for the conversion of the bonds (book value method). (Enter your answers in whole dollars. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Reference no: EM131740799

Questions Cloud

Reproduce data that would appear in the february worksheet : INDIGO CO. Worksheet (PARTIAL) For The Month Ended January 31, 2017 Trial Balance Adjustments Adjusted Trial Balance Accounts Title Debit Credit Debit Credit
Describe a communications plan the company could use to make : Describe a communications plan the company could use to make the strategies you recommend above known to all stakeholders.
What is the ph of the diluted selutie n : When 2.5 rnL of [L5 M NaDH selutien is diluted into 19 mL, what is the pH of the diluted selutie n?
Define a story of wall street : Explain the subtitle of Bartleby the Scrivener: A Story of Wall Street What does Melville imply about the business world
Prepare the journal entries for the issuance of the bonds : Prepare the journal entries for the issuance of the bonds by Gless and the purchase of the bond investment by Century.
Discuss the risks associated with changing exchange rates : Discuss the risks associated with changing exchange rates and international commerce and provide a scenario demonstrating these risks.
State the benefits and costs of voluntarily adopting hiring : Evaluate the ethical considerations of not voluntarily prohibiting the forms of discrimination laws examined in the first part of your report.
Meditating on race and ethnicity and identity : Of the selections on race and ethnicity that we read for this section of the course, select two essays to which to respond
Heat of vaporization : The specific heat of water is 1.00 cal/(g x °C); the heat of fusion is 80.0 cal/g; and the heat of vaporization is 540.0 cal/g.

Reviews

Write a Review

Accounting Basics Questions & Answers

  List the deposits in transit at the end of august

Identify and list the deposits in transit at the end of August. Identify and list the outstanding checks at the end of August. Prepare bank reconciliation for August. Give any journal entries that the company should make as a result of the bank recon..

  How much overhead will be assigned to each product

How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the total cost per unit produced

  Stangle company manufactures ties when 28000 ties are

stangle company manufactures ties. when 28000 ties are produced the costs per unit are direct materials 0.60 direct

  During january 19000 units were completed and transferred

during january 19000 units were completed and transferred. at january 31st 6500 units remained in work in process that

  Discuss use of the cost-recovery method

Lark Corp. has a contract to construct a $5,000,000 cruise ship at an estimated cost of $4,000,000. The company will begin construction of the cruise ship.

  Compute cost of ending inventory under variable costing

Inventory Valuation under Variable Costing Daltin Company produced 50,000 units during its first year of operations and sold 48,900 at $12 per unit.

  Sale and trading securities

Prepare the adjusting entry (if any) for 2007, assuming the securities are classified as trading. Prepare the adjusting entry (if any) for 2007, assuming the securities are classified as available for-sale.

  Disclose the resignation of a board member

What form reviewed in this chapter would be used to disclose the resignation of a board member? Comment on why it would be in the public interest to know the circumstances surrounding the resignation of this board member.

  Grocery corporation received 300328 for 250000 11 bonds

grocery corporation received 300328 for 250000 11 bonds issued on january 1 2009 at a market interest rate of 8. the

  Prepare the entries to record the closing of these items

Bleeker Company has the following merchandise account balances: Sales $195,000, Sales Discounts $2,000, Cost of Goods Sold $105,000 and Merchandise Inventory $40,000.

  Apple reports the following operating income

Apple's return on assets for each of its geographic segments, and assess the relative performance of these segments.

  Budgeted direct-labor costs for june

The direct labor hours are 11,000 and the direct labor rate is $10.50. Budgeted direct-labor costs for June would be:

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