On January 1, 2017. Bonobo Co. issued S20,000,000 of 10% bonds due in 10 years. Each $1,000 bond is cornvertible into two shares of the firm's $0.50 par value common stock. The bonds were issued at 98. On January 1, 2020, when the stock was selling for $200 per share, holders of 40% of the convertible bonds exercised their conversion options. Straight-line amortization is used for bond discounts or premiums. Instructions Prepare the necessary journal entries for the conversion of the bonds.
On January 1, 2017. Bonobo Co. issued S20,000,000 of 10% bonds due in 10 years. Each $1,000 bond is cornvertible into two shares of the firm's $0.50 par value common stock. The bonds were issued at 98. On January 1, 2020, when the stock was selling for $200 per share, holders of 40% of the convertible bonds exercised their conversion options. Straight-line amortization is used for bond discounts or premiums. Instructions Prepare the necessary journal entries for the conversion of the bonds.
Chapter1: Financial Statements And Business Decisions
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