On May 1, 2020, Fries Corporation issued P2,000,000, 20-year, 10% bonds for P2,120,000. Each P1,000 bond had a detachable warrant eligible for the purchase of one share of Fries’ P50 par ordinary share for P60. Immediately after the bonds were issued, Fries’ securities had the following market values: 10% bonds without warrants – P1,040; Warrant – P20; Ordinary share, P50 par – P56. What amount should Fries Corporation credit to Premium on Bonds Payable?   A. 80,000 B. 40,000 C. 120,000

Q: On January 1, 2019, Maeve Company issued P6,000,000 of 12% bonds payable maturing in five years. The…

A: Market price of Bonds Payable P56,00,000 Market price of share warrants  P8,00,000 Total market…

Q: On July 1, 2020, Shake Corporation issued its 10%, 7-year bonds with one detachable warrant attached…

A: solution : the issued instrument is a compound financial instrument We shall identify the financial…

Q: On September 1, 2020, Splish Company sold at 104 (plus accrued interest) 5,760 of its 9%, 10-year,…

A: Record general journal for issuance of bonds as shown below:

Q: Prepare the journal entry at the date of the bond purchase. (b)   Prepare the journal entries to…

A: Year Cash flow PVF @10% PV of Cash flow 2020      37,200 0.909      33,818.18 2021      37,200…

Q: On January 1, 2020, Bonita Company purchased 12% bonds, having a maturity value of $320,000 for…

A: There are two methods of amortizing the premium or discount of bonds that are issued at a price…

Q: On January 1, 2021, Watermelon Company issued 3,000 of its 10%, 5-year P1,000 face value bonds with…

A: On 1st January 2021, Watermelon Company has issued 3000 10% 5 year bonds with detachable warrants.…

Q: On January 1, 2020, Sage Company purchased  11% bonds, having a maturity value of $ 301,000 for $…

A: Bond purchased: In order to obtain money from investors who are prepared to lend them money for a…

Q: On January 1, 2020, Teal Company sold 11% bonds having a maturity value of $500.000 for $ 518.953,…

A: Annual interest payment = Face value of bonds x rate of interest x no. of months/12 = $500,000 x 11%…

Q: On May 1, 2018, Luzon Company issued P2,000,000, 5 year, 10% bonds for P2,300,000. Each P1,000 bonds…

A: Share warrants means rights attached with the issue of bonds by which person has the right to…

Q: On December 31, 2019, Buffalo Wings Co. had outstanding P20 million face value convertible bonds…

A: P20 million face value convertible bonds maturing on December 31, 2022 2,000 of the bonds exercised…

Q: Sandhill Co. issued $4,100,000 of 12%, 5-year convertible bonds on December 1, 2020 for $4,122,360…

A: When the bonds are issued at premium, the amortisation premium needs to be adjusted against the…

Q: cember 31, 2021, German Corporation issued 5,000 of its 10%, 10-year, face value bonds with…

A: Bondholders: Bondholders are the individuals or entities who acquires the bonds from an issuing…

Q: On August 31, 2020, Cebu Pacific Co. issued a 3,000, P1,000, 10%, 5 year bonds at 110 including…

A: Bonds are the financial instruments used by the company to raise money from the investor which…

Q: Prepare all the necessary journal entries assuming the share warrants are fully exercised.

A: Issue price of bonds with warrants (5,000,000 x 103) =  515,000,000 Market value of bonds without…

Q: On January 1, 2020, Aumont Company sold 12% bonds having a maturity value of $ 500,000 for $…

A: Solution: Computation of bond price Table values are based on: n= 5     i= 10.00%…

Q: During 2018, QQ Corporation issued at 95, 1,000 of its 8%, P5,000 bonds due in ten years. One…

A: Solution- Market price of bond= 50000* 1000 * .06 ( 60 * 10%)= 3000000 Market value of stock warrent…

Q: Maple Management Inc. issued 6 percent bonds with a maturity value of $6,000,000 for $5,513,346 on…

A: Bond interest and bond discount are amortized over the life of the bonds. Under the effective…

Q: On January 1, 2020, Oriole Company purchased 6% bonds, having a maturity value of $620,000 for…

A: Solution A Bond represents a loan to company or government in return of this company pay a fixed…

Q: Sandhill Co. issued $4,100,000 of 12%, 5-year convertible bonds on December 1, 2020 for $4,122,360…

A: Convertible bonds are a type of bonds issued by the organization, where at the time of maturity of…

Q: On January 1, 2020, Hi and Lois Company purchased 12% bonds having a maturity value of $300,000 for…

A: Journal entry is the process of recording business transactions for the first time in the accounting…

Q: On December 31, 2019, Claudine Company issued 5,000 of 8% 10-year P1,000 face value bonds with…

A: Bonds-:A Bond is a method/instrument of indebtedness of the issuer of the bond to the owner. The…

Q: On December 30, 2021, First Company issued 5,000 of 8%, 10-year, P 1,000 face value bonds with share…

A: Bond Payable There are different type of bond can be issued like discount on bond, par value on bond…

Q: On May 1, 2020, Manny Company issued P2 million, 20-year, 10% bonds for P2,120,000. Each P1,000 bond…

A: 1. Premium on bonds payable arises when the stated rate on bond is higher than its market value 2.…

Q: On January 1, 2019, Post Malone Company issued P6,000,000 of 12% bonds payable maturing in five…

A: Share warrant refers to the document which is issued through the company under the common seal and…

Q: On May 1, 2021, Payne Co. issued $1,500,000 of 7% bonds at 103, which are due on April 30, 2031.…

A: Bonds represent the liabilities on which a fixed percentage of interest has to be paid over a period…

Q: On January 1, 2016, Case Company issued P5,000,000 of 12% nonconvertible bonds at 103 which are due…

A: The proceeds of issue is allocated based on their relative fair value of warrants and bonds Fair…

Q: On January 1, 2020, Stellar Company purchased 12% bonds, having a maturity value of $325,000 for…

A:

Q: On May 1, 2021, Coronado Industries issued $2950000 of 7% bonds at 104, which are due on April 30,…

A: Bonds are the highly secured securities which are redeemable after a certain span of time.

Q: What is the credit to share premium in 2019 from the issuance of the shares through the exercise of…

A:

Q: On January 1, 2020, Sage Company purchased  11% bonds, having a maturity value of $ 301,000 for $…

A: The question is based on the concept of Financial Accounting.

Q: On December 31, 2022, Two Company issued 5,000 of its 12%, 10-year P1,000 face value bonds with…

A: Here discuss about the details of issuance of Bod with detachable warrant and its calculation which…

Q: On May 1, 2021, Duck Corporation issued $2,000,000 of 8% nonconvertible bonds at 104, which are due…

A: Isssue Price of Bonds ($2000000 * 104%) $20,80,000     Fair market value of bonds ($2000000 *…

Q: On July 1, 2020, Shake Corporation issued P5,000,000 of its 10%, 7-year bonds with one detachable…

A: Bond is a debt instrument issued by a company to get the cash from the public. It carry a interest…

Q: On September 1, 2020, Sands Company sold at 104 (plus accrued interest) 4,000 of its 9%, 10-year,…

A: Workings: Calculation of face value of bond: = 4000 x 1000 = 4000000   Calculation of selling price…

Q: On September 1, 2020, Wildhorse Company sold 9,960 of its 9%, 15-year, $1,000 face value,…

A: The question is based on the concept of Financial Accounting.

Q: On August 1, 2021, Limbaugh Communications issued $30 million of 10% nonconvertible bonds at 104.…

A: a) Step 1: Prepare the journal entry to record the issuance of the bonds by Limbaugh

Q: On January 1, 2019, COT Co. issued P1,500,000, 12% convertible bonds due after 4 years. The bonds…

A: Fair value represents the market value of the asset whereas, book value represents the value of…

Q: On January 1, 2023, Baker Company purchased, as an investment, 5% bonds, having a maturity value of…

A: The Baker Co. purchased 5% bonds at discount of 11,600 [150,000-138,400].  The…

Q: On September 1, 2020, Crane Company sold at 104 (plus accrued interest) 3,000 of its 9%, 10-year,…

A: A bond refers to a fixed income instrument that speaks to a credit made by a speculator to a…

Q: On January 1, 2020, Stellar Company purchased 12% bonds, having a maturity value of $325,000 for…

A: The question is based on the concept of Financial Accounting.

Q: On January 1, 2020, Coronado Company purchased 13% bonds, having a maturity value of $279,000 for…

A: SOLUTION - A journal entry records a business transaction in the accounting system for an…

Q: On January 1, 2020, Hummer Company purchased 5% bonds, havinga maturity value of $500,000, for…

A: a. Journal entry at the date of the bond purchase:

Q: On January 1, 2020, Sandhill Company purchased 12% bonds, having a maturity value of $325,000 for…

A: ) Date General Journal Debit Credit   Jan. 1, 2020 Debt investments 349,639.81       Cash…

Q: On January 1, 2020, Hi and Lois Company purchased 12% bonds, having a maturity value of $300,000 for…

A: Step 1 Journal is the part of book keeping.

Q: On May 1, 2018, Luzon Company issued P2,000,000, 5 year, 10% bonds for P2,300,00O. Each P1,000 bonds…

A: Share warrants are the rights attached with the issue of shares which provides the issuer of the…

Q: On January 1, 2020, Booker Corp. issued $9 million of ten year bonds at 100.5 (Booker amortizes any…

A: The bonds issued are recorded as bonds payable and these represent the long-term liabilities. When a…

Q: On March 1, 2021, E Corp. issued $1,000,000 of 10% nonconvertible bonds at 104, due on February 28,…

A: Increase in shareholders equity=Number of bonds issued×Stock warrants per bond×Market price of each…

Q: On December 1, 2021, Bramble Corp.issued 680 of its 8%, $1.000 bonds at 104. Attached to each bond…

A: Compound financial instruments are instruments with both debt and equity component. Therefore, the…

Q: On July 1, 2022, Mocha Corporation issued P5M of its 10%, 7-year bonds with one detachable share…

A: The question has asked about the issue price of the share warrants outstanding. Definition of some…