Reference no: EM132873061
Question - DLC Company, a technology startup, is undergoing a new round of financing and seeks to entice bondholders by offering multiple types of debt. One set of bonds has detachable warrants. At the beginning of the current fiscal year, DLC issued $5,000,000 of 10% bonds for $5,210,000. Each $1,000 bond had 20 detachable warrants, and each of these warrants was redeemable for one share of DLC $1 par value stock at a price of $25. The fair value of a warrant was $10.
To prepare each required journal entry:
-Click on a cell in the Account Name column and select from the option list the appropriate account. An account may be used once, more than once, or not at all.
-Enter the corresponding debit or credit amount in the associated column.
-Round all amounts to the nearest whole number.
-Not all rows in the table might be needed to complete each journal entry.
-If no journal entry is needed, check the "No entry required" box at the top of the table as your response.
1. Record the journal entries to account for the issuance of the bonds.
2. Record the journal entries to account for the issuance of the warrants.
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