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What amount shall be credited to share premium upon exercise

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On March 1, 2020, De Blas Co, issued P1,000,000 of its 10% non-convertible bonds at 104, due February 28, 2025. Each P1,000 bond
was issued with a non-detachable share warrant, each of which entitles the holder to purchase 3 ordinary shares with P25 par value for P40 each over the term of the bond. If sold without the warrants, the bonds would yield 12%. The interest on the bonds is payable annually every February 28 starting February 28, 2021.

  • On December 31, 2020, 200 share warrants were exercised and on June 30, 2021, 350 share warrants were exercised. Remaining share warrants were retired on maturity date.

Problem 1: What amount was assigned to the share warrants on March 1, 2020?

Problem 2: What amount shall be credited to share premium upon exercise of the share warrants on December 31, 2020?

Problem 3: What amount shall be credited to share premium upon exercise of the share warrants on June 30, 2021?

Problem 4: What amount shall be credited to share premium upon retirement of the bonds on February 28, 2025?

Reference no: EM132808257

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