Blueing Airways' common stock is currently priced at P39. Its 8 percent convertibledebentures issued at their P1,000 par and are currently priced at P1,050. Each debenturecan be converted into 25 shares of common stock at any time before 2010. What is theconversion value of the bond?O P1,000O P900P1,050O P975

Conversion value of the bond = No. of shares of common stock convertible x market price per share

Answered: Blueing Airways' common stock is…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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1. Find the current bond price
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00Ucation.com/exl/map/index.html?.con con&external_browser=0&launchUrl=https%253A%252F%252Fnewconnect.mheducation.com%2 JTFA 2021 6 Sved General Corporation purchased $938,000 of bonds with a coupon rate of 10% at face value on December 5, 2021. The market pric the bond was $984,000 on December 31, 2021, Required: Prepare the appropriate journal entry on December 31, 2021, to properly value the bonds assuming the bonds are classified as: (If m entry is required for a transaction/event, select "No journal entry required" in the first account field.) Ignore the journal entry for coupon payment and interest recognition. 1. Trading securities. 2. Securities available-for-sale. 19 3. Held-to-maturity securities. View transaction list Journal entry worksheet Record the unrealized holding gain or loss for securities available-for-sale. Note: Enter debits before credits Transaction General Joumal Debit Credit 2. MacBook Pro DII FA FS FR %23 24 & 4. 6. 8 Q R T Y F H. J K C V command ption…
1. 2. 3. 1. 2. On August 1, 2025, Lane Corporation called its 10% convertible bonds for conversion. The $8,000,000 par bonds were converted into 320,000 shares of $20 par common stock. On August 1, there was $800,000 of the unamortized premium applicable to the bonds. The fair value of the common stock was $20 per share. Ignore all interest payments. No. Account Titles and Explanation 3. Packard, Inc. decides to issue convertible bonds instead of common stock. The company issues 10% convertible bonds, par $4,000,000, at 97. The investment banker indicates that if the bonds had not been convertible, they would have sold at 94. Gomez Company issues $9,000,000 of bonds with a coupon rate of 8%. To help the sale, detachable stock warrants are issued at the rate of ten warrants for each $1,000 bond sold. It is estimated that the value of the bonds without the warrants is $8,883,000 and the value of the warrants is $567,000. The bonds with the warrants sold at 101. Bonds Payable Premium on…
H3. On a given day a share dealer maintains a bid price of R1 000.50 for a bond and an ask price of R1 003.25. The dealer made 10 trades that totalled 500 bonds traded that day. What was the dealer's gross trading profit for this bond? Please show proper step by step calculation
Given the following information concerning a convertible bond: Principle: $1,000 Coupons: 5 percent Maturity: 15 years Call Price: $1,050 Conversion price: $37 (i.e., 27 shares) Market Price of the Bond: $1040 Common stock: $30 G. What is the probability that the corporation will call this bond? H. Why are investors willing to pay the premiums mentioned in questions d and f? (D, What is the premium in terms of stock that the investor pays when he or she purchases the convertible bond instead of the stock? F,What is the premium in terms of debt that the investor pays when he or she purchases the convertible bond instead of a nonconvertible bond?) (dont need D and F answers only G. and H. need help with please dont put in excel i dontunderstand that stuff yet equations and worded answers please)
1 ences The bonds of Generic Labs Inc. have a conversion premium of $60. Their conversion price is $25. The common stock price is $21.00. What is the price of the convertible bond? (Do not round intermediate calculations and round your answer to 2 decimal places.) Mc Graw Hill Convertible bond price Prev 2 of 10 MacBook Air Next >
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