Prepare the necessary journal entries

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Question - On January 1, 2020, ABC Company issued P50,000,000, 3-year convertible bonds at par with the following considerations:

(a) there were no issue costs related

(b) the coupon rate is 10%, payable annually in arrears on December 31

(c) the bond is redeemable at par on January 1, 2023

(d) bonds issued by similar companies without any conversion rights currently bear interest at 15%

Required - Prepare the necessary journal entries assuming the bondholders:

a. opted for conversion

b. opt for cash payment

Reference no: EM133172659

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