Reference no: EM131129818
Presented below are three independent situations.
1. Sigel Corporation retired $130,000 face value, 12% bonds on June 30, 2010, at 102.The carrying value of the bonds at the redemption date was $117,500.The bonds pay semiannual interest, and the interest payment due on June 30, 2010, has been made and recorded.
2. Diaz Inc. retired $150,000 face value, 12.5% bonds on June 30, 2010, at 98.The carrying value of the bonds at the redemption date was $151,000.The bonds pay semiannual interest, and the interest payment due on June 30, 2010, has been made and recorded.
3. Haas Company has $80,000, 8%, 12-year convertible bonds outstanding. These bonds were sold at face value and pay semiannual interest on June 30 and December 31 of each year. The bonds are convertible into 30 shares of Haas $5 par value common stock for each $1,000 worth of bonds. On December 31, 2010, after the bond interest has been paid, $20,000 face value bonds were converted. The market value of Haas common stock was $44 per share on December 31, 2010.
Instructions
For each independent situation above, prepare the appropriate journal entry for the redemption or conversion of the bonds.
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Complete the income statement and balance sheet for whittake
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Prepare the journal entries to record the mortgage loan
: Leoni Co. receives $240,000 when it issues a $240,000, 10%, mortgage note payable to finance the construction of a building at December 31, 2010.
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Presented below are three independent situations
: Sigel Corporation retired $130,000 face value, 12% bonds on June 30, 2010, at 102.The carrying value of the bonds at the redemption date was $117,500.
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Prepare the entry to record the payment of interest on july
: Prepare the entry to record the payment of interest on July 1, 2010, assuming no previous accrual of interest on the remaining bonds.
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Compute the total cost of borrowing for these bonds
: Repeat the requirements from part (a), assuming the bonds were issued at 105.
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Prepare the journal entry to record the issuance of the bond
: Prepare the journal entry to record the conversion of the bonds into 30,000 shares of $10 par value common stock. Assume the bonds were issued at par.
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Prepare the journal entries to record the following events
: The redemption of bonds at maturity, assuming interest for the last interest period has been paid and recorded.
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