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Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b 02 Cash Cash Bonds payable Bonds payable Premium on bonds payable Cash Answer is not complete. General Journal Common stock Additional paid-in capital 000 O 00 *** Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 O 135,903 45,000 1,000,000

Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b 02 Cash Cash Bonds payable Bonds payable Premium on bonds payable Cash Answer is not complete. General Journal Common stock Additional paid-in capital 000 O 00 *** Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 O 135,903 45,000 1,000,000

FINANCIAL ACCOUNTING
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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Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: • Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. • Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b. 02 Cash Bonds payable Premium on bonds payable Cash Bonds payable Answer is not complete. General Journal Cash Common stock Additional paid-in capital 000 00 000 Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 135,903 45,000 1,000,000
Transcribed Image Text:Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: • Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. • Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b. 02 Cash Bonds payable Premium on bonds payable Cash Bonds payable Answer is not complete. General Journal Cash Common stock Additional paid-in capital 000 00 000 Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 135,903 45,000 1,000,000
Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: • Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. • Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b. 02 Cash Bonds payable Premium on bonds payable Cash Bonds payable Answer is not complete. General Journal Cash Common stock Additional paid-in capital 000 00 000 Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 135,903 45,000 1,000,000
Transcribed Image Text:Case D: Miller Bikes is a national chain of upscale bicycle shops. The company has followed a successful strategy of locating near major universities. Miller has the opportunity to expand into several new markets but must raise additional capital. The company has engaged in the following transactions: • Issued 45,000 additional shares of common stock. The stock has a $1 par value. The shares sold for $25 per share. • Issued bonds. These bonds have a face value of $1,000,000 and a coupon rate of 10 percent. The bonds mature in 10 years and pay interest semiannually. When the bonds were issued, the annual market rate of interest was 8 percent. Required: 1. Record the sale of the bonds. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2. Record the issuance of the stock. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No A 8 C Transaction 1a 1b. 02 Cash Bonds payable Premium on bonds payable Cash Bonds payable Answer is not complete. General Journal Cash Common stock Additional paid-in capital 000 00 000 Debit 1,135,903 1,135,903 1,125,000 Credit 1,000,000 135,903 45,000 1,000,000
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