Record the conversion of the bonds

Reference no: EM13141103

On January 2, 2006, Picard Enterprises issued $2,400,000 of 8 percent, 15-year semiannual coupon bonds to yield 7.5 percent. Each bond is convertible into 40 shares of $15 par common stock, which was trading at $20 per share on the date of the bond issue. The bonds were issued at 106. Without the conversion feature, the bonds would have been issued for 104.5

On January 3, 2011, all of the bonds were converted into common stock. The market price of the stock was $28 per share on the date of conversion. The issue premium is amortized using the straight-line method.

(1) Provide the journal entry to record issuance of the bonds.

(2) Provide the journal entry to record the conversion of the bonds assuming Picard considers the conversion

(a) not to be a significant culminating transaction.
(b) to be a significant culminating transaction.

Reference no: EM13141103

Questions Cloud

Calculation of amount budgeted for the month : Andrea's Hobbies produces and sells a luxury animal pillow for $40.00 per unit. In the first month of operation, 3,000 units were produced and 2,250 units were sold. Actual fixed costs are the same as the amount budgeted for the month. Other infor..

What is the final concentration of cells : you have 0.05mL of an undiluted culture at a concentration of 3.6 X 10^6 CFU/mL. You then add 4.95mL sterile diluent. What is the dilution, and what is the final concentration of cells?

Explain what is the impedance of the load : A load has a 20 ohm resistor and a 4 Henry inductor connected in series. It is connected to a power source with v(t) = 100 cos(50t), connected in series to the load. What is the impedance of the load? Use phasor transform methods to obtain your an..

How could you characterize any non serratia marcescens : within the context of this simulation, how could you characterize any "non Serratia marcescens" growth on slide 1 or 2 of your plate.

Record the conversion of the bonds : Provide the journal entry to record the conversion of the bonds assuming Picard considers the conversion

Consider a direct sequence spread spectrum : Consider a direct sequence spread spectrum (DSSS) system attempting to transfer data. The DSSS system has a data rate of 2 Kbps (2 thousand bits/sec) which is spread to 2 Mcps

Should teachers take time to understand : Question for Maria 10.3 is "Should teachers take time to understand a student's culture? Is it really relevant?" 2. Question for Martha 3.3 is "Should Governments provide compulsory training for parents and guardians to give them opportunities to ta..

Determining income tax return : Alice Johnson, Social Security number 222-23-3334, is a single taxpayer and is employed as a secretary by State University of Florida. She has the following items pertaining to her income tax return for the current year:

Does the agar have an antibiotic beyond zone of inhibition : does the agar have an antibiotic beyond the zone of inhibition? how does your answer tie in with MIC?

User Account

All Pages