On May 1, 2011, Stone Corporation issued $4 million of 10-year, 6% convertible bonds at 101. The similar bonds without the conversion rights were sold at 97. Interest is to be paid semi-annually on April 30 and October 31. Stone Corporate uses the straight-line method to amortize bond discount. On July 1, 2017, $1 million of bonds were converted into common shares. Stone Corporation uses the residual method in accounting for the issuance of convertible bonds. December 31 is the end of accounting year (reporting date). Required: Prepare journal entries needed at May 1, 2011; December 31, 2012; April 30, 2014; July 1, 2017;
On May 1, 2011, Stone Corporation issued $4 million of 10-year, 6% convertible bonds at 101. The similar bonds without the conversion rights were sold at 97. Interest is to be paid semi-annually on April 30 and October 31. Stone Corporate uses the straight-line method to amortize bond discount. On July 1, 2017, $1 million of bonds were converted into common shares. Stone Corporation uses the residual method in accounting for the issuance of convertible bonds. December 31 is the end of accounting year (reporting date). Required: Prepare journal entries needed at May 1, 2011; December 31, 2012; April 30, 2014; July 1, 2017;
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 21E: On July 2, 2018, McGraw Corporation issued 500,000 of convertible bonds. Each 1,000 bond could be...
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On May 1, 2011, Stone Corporation issued $4 million of 10-year, 6% convertible bonds at 101. The similar bonds without the conversion rights were sold at 97. Interest is to be paid semi-annually on April 30 and October 31. Stone Corporate uses the straight-line method to amortize bond discount. On July 1, 2017, $1 million of bonds were converted into common shares. Stone Corporation uses the residual method in accounting for the issuance of convertible bonds. December 31 is the end of accounting year (reporting date).
Required:
Prepare
- May 1, 2011;
- December 31, 2012;
- April 30, 2014;
- July 1, 2017;
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