Provide the entry to record the retirement of the bonds

Assignment Help Financial Accounting
Reference no: EM132991161

Question - Convertible bonds - retirement - On Jan 1,20x1, an entity issues bonds with face amount of P5,000,000 for 5,200,000. The bonds mature on Dec 31,20x3 and pay annual interest of 12%. The bonds can be converted into 10,000 ordinary shares of the entity with par value per share of P200. On Jan 1,20x1, the bonds are selling at 101 without thr conversion feature. The effective interest rate on the bonds is 11.59%. All of the bonds are converted into ordinary shares on Jan 1, 20x3.

Use the facts above. However, in this case, the entity retires the bonds on Jan 1,20x3 at a call premium of P200,000. Without the conversion feature, the bonds are selling in this date at 102.

Provide the entry to record the retirement of the bonds.

Reference no: EM132991161

Questions Cloud

How much do you make-lose : Assume that you can borrow £1,000,000 or its equivalent in USD. How much do you make/lose if you borrow the foreign currency and invest locally
What additional information do you need : Your supervisor has asked you to contact Windsor Foods to explore a possible outsourcing. What additional information do you need
What would be the monthly payments : Considering to buy a house, you are thinking of a mortgage with the amount of $550,000, with 9% interest rate for 15 years. What would be the monthly payments
Compute appen ltd weighted average cost of capital : Appen Ltd. has an outstanding bond issue that the company sold 5 years ago for $50 million. Compute Appen Ltd weighted average cost of capital
Provide the entry to record the retirement of the bonds : Without the conversion feature, the bonds are selling in this date at 102. Provide the entry to record the retirement of the bonds
What investment proportions in risky portfolio : The risky portfolio has expected return of 12%, standard deviation of 18%, while return on risk-free asset is 5%. What investment proportions in risky portfolio
What is the current price of the share : Tre-Bien Ltd is a fast growing technology company. If your required rate of return on such shares is 21 percent, what is the current price of the share
What is diluted earnings per share : For the year ended December 31, 2021, what is diluted earnings per share, and is it reported on the income statement
Determine the dollar value of the annual bond premium : Baltimore uses the straight-line method for amortization. Use this information to determine the dollar value of the annual bond premium amortization

Reviews

Write a Review

Financial Accounting Questions & Answers

  Compute the standard deviation of the rate of return

Compute the standard deviation of the rate of return for the one-year period. You have concluded that next year the relationships are possible

  What amount should oak report as bonds payable

What amount should Oak report as bonds payable, net of discount? On January 1, Year 2, Oak Co. issued 400 of its 8%, $1,000 bonds at 97 plus accrued

  Estimation of the firms present cash conversion cycleyou

estimation of the firms present cash conversion cycle.you were recently hired as cfo to improve the performance of

  How calculate the balance in the retained earnings account

Calculate the balance in the retained earnings account at January 31, 2020.At January 1, 2020, JYA Corporation had outstanding 6,000 shares of 5%

  What is the total cost of the building for Samuel

Samuel paid $850 000.00 for a new house. He paid $140 000.00 down, What is the total cost of the building for Samuel

  What is the effect on the cash account

If ABC pays the invoice on the seventeenth day, what is the effect on the Cash account and will the Cash account be debited or credited?

  Merchandise inventory account fixed asset-true or false

When the periodic inventory system is in use, the dollar value of the ending inventory is determined by taking a physical count.-True or False?

  What the owner equity account reflects

In the adjusted trial balance, the Owner's Equity account reflects? the beginning-of-the-period balance. / the increase to income and expense.

  Determine what is the profitability index of the project

Virtucon Company is evaluating a project that has an initial cash outflow of $6000, What is the profitability index of the project?

  What would be the pre-tax gain or loss to the consolidated

Parent owns 75% of Sub. What would be the pre-tax gain or loss to the consolidated entity on the intercompany sale of the bonds?

  Find and comment on ethical issues involved in skimming

Comment on the legal and ethical issues involved in skimming. With the help of his spouse, he is able to perform all the bookkeeping

  How estimate the book value per share of the common stock

Determine the book value per share of the common stock. Assume that wireless has paid preferred dividends for current year and all prior years (no dividends)

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