6:00 PM1.6KB/s A.89QuizzesOn August 31, 2020, Cebu PacificCo. issued a 3,000, P1,000, 10%, 5year bonds at 110 including accruedinterest. The bond was datedJanuary 1, 2020. Each bond isentitled of 2 warrants where eachwarrant gives the bondholder theright to purchase 15 shares ofcommon stock, P100 par at P110.On August 31, 2020, the prevailingmarket interest rate for similar debtwithout warrant is 12%.On January 1, 2021, 40% of thewarrant was exercised.Question: How much number ofshares were purchased upon exerciseof the warrant?

Solution- Given-On August 31,2020 ,3000 P1000 10%Year bond dated january 1,2020 issuedat P110…

Answered: On August 31, 2020, Cebu Pacific Co.…

On August 31, 2020, Cebu Pacific Co. issued a 3,000, P1,000, 10%, 5 year bonds at 110 including accrued interest. The bond was dated

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter7: Financial Activities

Section: Chapter Questions

Problem 11QE

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Question

6:00 PM
1.6KB/s A.
89
Quizzes
On August 31, 2020, Cebu Pacific
Co. issued a 3,000, P1,000, 10%, 5
year bonds at 110 including accrued
interest. The bond was dated
January 1, 2020. Each bond is
entitled of 2 warrants where each
warrant gives the bondholder the
right to purchase 15 shares of
common stock, P100 par at P110.
On August 31, 2020, the prevailing
market interest rate for similar debt
without warrant is 12%.
On January 1, 2021, 40% of the
warrant was exercised.
Question: How much number of
shares were purchased upon exercise
of the warrant?

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