Mecca Energy Corp. issued a convertible bond on 1 August 20X9. The 10-year, 5% $16,000,000 bond pays interest semi-annually each 31 July and 31 January. At maturity, each $1,000 bond is convertible into 120 common shares. The bond was issued for $16,640,000. Market interest rates were approximately 6%. PV of $1, PVA of $1, and PVAD of $1.) (Use appropriate factor(s) from the tables provided.) Required: 1. Provide the journal entry to record the initial issuance of the bond. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your time value to 5 decimal places and your final answers to the nearest whole dollar.) View transaction list Journal entry worksheet 1 Record the entry for issuance of bonds. Note: Enter debits before credits. Transaction 1 General Journal Debit Credit 2. Assume instead that the bond was convertible into common shares at the maturity date into common shares based on the market value of common shares at that time. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Record the entry for issuance of bonds. Note: Enter debits before credits. Transaction 1 General Journal Debit Credit
Mecca Energy Corp. issued a convertible bond on 1 August 20X9. The 10-year, 5% $16,000,000 bond pays interest semi-annually each 31 July and 31 January. At maturity, each $1,000 bond is convertible into 120 common shares. The bond was issued for $16,640,000. Market interest rates were approximately 6%. PV of $1, PVA of $1, and PVAD of $1.) (Use appropriate factor(s) from the tables provided.) Required: 1. Provide the journal entry to record the initial issuance of the bond. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your time value to 5 decimal places and your final answers to the nearest whole dollar.) View transaction list Journal entry worksheet 1 Record the entry for issuance of bonds. Note: Enter debits before credits. Transaction 1 General Journal Debit Credit 2. Assume instead that the bond was convertible into common shares at the maturity date into common shares based on the market value of common shares at that time. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Record the entry for issuance of bonds. Note: Enter debits before credits. Transaction 1 General Journal Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Mecca Energy Corp. issued a convertible bond on 1 August 20X9. The 10-year, 5% $16,000,000 bond pays interest semi-annually each
31 July and 31 January. At maturity, each $1,000 bond is convertible into 120 common shares. The bond was issued for $16,640,000.
Market interest rates were approximately 6%.
PV of $1, PVA of $1, and PVAD of $1.) (Use appropriate factor(s) from the tables provided.)
Required:
1. Provide the journal entry to record the initial issuance of the bond. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account field. Round your time value to 5 decimal places and your final answers to the nearest
whole dollar.)
View transaction list
Journal entry worksheet
1
Record the entry for issuance of bonds.
Note: Enter debits before credits.
Transaction
1
General Journal
Debit
Credit](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F740f2d05-a380-4ca2-a65f-14a0b012be8e%2F26a04547-4a42-436d-ae47-180563386074%2Fyuyqigt_processed.png&w=3840&q=75)
Transcribed Image Text:Mecca Energy Corp. issued a convertible bond on 1 August 20X9. The 10-year, 5% $16,000,000 bond pays interest semi-annually each
31 July and 31 January. At maturity, each $1,000 bond is convertible into 120 common shares. The bond was issued for $16,640,000.
Market interest rates were approximately 6%.
PV of $1, PVA of $1, and PVAD of $1.) (Use appropriate factor(s) from the tables provided.)
Required:
1. Provide the journal entry to record the initial issuance of the bond. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account field. Round your time value to 5 decimal places and your final answers to the nearest
whole dollar.)
View transaction list
Journal entry worksheet
1
Record the entry for issuance of bonds.
Note: Enter debits before credits.
Transaction
1
General Journal
Debit
Credit
![2. Assume instead that the bond was convertible into common shares at the maturity date into common shares based on the market
value of common shares at that time. (If no entry is required for a transaction/event, select "No journal entry required" in the first
account field.)
View transaction list
Journal entry worksheet
1
Record the entry for issuance of bonds.
Note: Enter debits before credits.
Transaction
1
General Journal
Debit
Credit](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F740f2d05-a380-4ca2-a65f-14a0b012be8e%2F26a04547-4a42-436d-ae47-180563386074%2Fqcd9yul_processed.png&w=3840&q=75)
Transcribed Image Text:2. Assume instead that the bond was convertible into common shares at the maturity date into common shares based on the market
value of common shares at that time. (If no entry is required for a transaction/event, select "No journal entry required" in the first
account field.)
View transaction list
Journal entry worksheet
1
Record the entry for issuance of bonds.
Note: Enter debits before credits.
Transaction
1
General Journal
Debit
Credit
AI-Generated Solution
Unlock instant AI solutions
Tap the button
to generate a solution
Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education