For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Bridgeport Corp. issued $18,800,000 par value 11% convertible bonds at 99. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95. 2. Indigo Company issued $18,800,000 par value 11% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for $4. 3. Suppose Sepracor, Inc. called its convertible debt in 2020. Assume the following related to the transaction. The 12%, $10,100,000 par value bonds were converted into 1,010,000 shares of $1 par value common stock on July 1, 2020. On July 1, there was $52,000 of unamortized discount applicable to the bonds, and the company paid an additional $75,000 to the bondholders to induce conversion of all the bonds. The company records the conversion using the book value method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit 1. enter an account title for the first transaction enter a debit amount enter a credit amount enter an account title for the first transaction enter a debit amount enter a credit amount enter an account title for the first transaction enter a debit amount enter a credit amount 2. enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount 3. enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction

For each of the unrelated transactions described below, present the entries required to record each transaction. 1. Bridgeport Corp. issued $18,800,000 par value 11% convertible bonds at 99. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95. 2. Indigo Company issued $18,800,000 par value 11% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for $4. 3. Suppose Sepracor, Inc. called its convertible debt in 2020. Assume the following related to the transaction. The 12%, $10,100,000 par value bonds were converted into 1,010,000 shares of $1 par value common stock on July 1, 2020. On July 1, there was $52,000 of unamortized discount applicable to the bonds, and the company paid an additional $75,000 to the bondholders to induce conversion of all the bonds. The company records the conversion using the book value method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit 1. enter an account title for the first transaction enter a debit amount enter a credit amount enter an account title for the first transaction enter a debit amount enter a credit amount enter an account title for the first transaction enter a debit amount enter a credit amount 2. enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount enter an account title for the second transaction enter a debit amount enter a credit amount 3. enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction enter a debit amount enter a credit amount enter an account title for the third transaction

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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Question

For each of the unrelated transactions described below, present the entries required to record each transaction.

1.		Bridgeport Corp. issued $18,800,000 par value 11% convertible bonds at 99. If the bonds had not been convertible, the company’s investment banker estimates they would have been sold at 95.
2.		Indigo Company issued $18,800,000 par value 11% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for $4.
3.		Suppose Sepracor, Inc. called its convertible debt in 2020. Assume the following related to the transaction. The 12%, $10,100,000 par value bonds were converted into 1,010,000 shares of $1 par value common stock on July 1, 2020. On July 1, there was $52,000 of unamortized discount applicable to the bonds, and the company paid an additional $75,000 to the bondholders to induce conversion of all the bonds. The company records the conversion using the book value method.

(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

No.	Account Titles and Explanation	Debit	Credit
1.	enter an account title for the first transaction	enter a debit amount	enter a credit amount
	enter an account title for the first transaction	enter a debit amount	enter a credit amount
	enter an account title for the first transaction	enter a debit amount	enter a credit amount
2.	enter an account title for the second transaction	enter a debit amount	enter a credit amount
	enter an account title for the second transaction	enter a debit amount	enter a credit amount
	enter an account title for the second transaction	enter a debit amount	enter a credit amount
	enter an account title for the second transaction	enter a debit amount	enter a credit amount
3.	enter an account title for the third transaction	enter a debit amount	enter a credit amount
	enter an account title for the third transaction	enter a debit amount	enter a credit amount
	enter an account title for the third transaction	enter a debit amount	enter a credit amount
	enter an account title for the third transaction	enter a debit amount	enter a credit amount
	enter an account title for the third transaction	enter a debit amount	enter a credit amount
	enter an account title for the third transaction

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