Record journal entries to account for issuance of bonds

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Reference no: EM133235721

Financial Accounting Question - DLC Company, a technology startup, is undergoing a new round of financing and seeks to entice bondholders by offering multiple types of debt. One set of bonds has detachable warrants. At the beginning of the current fiscal year, DLC issued $5,000,000 of 10% bonds for $5,210,000. Each $1,000 bond had 20 detachable warrants, and each of these warrants was redeemable for one share of DLC $1 par value stock at a price of $25. The fair value of a warrant was $10.

Required -

1. Record the journal entries to account for the issuance of the bonds.

2. Record the journal entries to account for the issuance of the warrants.

Reference no: EM133235721

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