On January 1, 2020, Swifty Corporation issued $4,180,000 of 10-year, 8% convertible debentures at 102. Interest is to be paie semiannually on June 30 and December 31, Each $1,000 debenture can be converted into 8 shares of Swifty Corporation $102 par value common stock after December 31, 2021. On January 1, 2022, $418,000 of debentures are converted into common stock, which is then selling at $111. An additional $418,000 of debentures are converted on March 31, 2022. The market price of the common stock is then $116. Accrued interest at March 31 will be paid on the next interest date. Bond premium is amortized on a straight-line basis. Make the necessary journal entries for: (a) December 31, 2021. (c) (b) January 1, 2022. (d) Record the conversions 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 O for the amounts. Round answers to O decimal places, e.g. 5,275) Date Account Titles and Explanation Dec. 31. 2021 Interest Expense March 31, 2022. June 30, 2022. Premium on Bonds Payable Cash Debit 163020 4180 Credit 167200

On January 1, 2020, Swifty Corporation issued $4,180,000 of 10-year, 8% convertible debentures at 102. Interest is to be paie semiannually on June 30 and December 31, Each $1,000 debenture can be converted into 8 shares of Swifty Corporation $102 par value common stock after December 31, 2021. On January 1, 2022, $418,000 of debentures are converted into common stock, which is then selling at $111. An additional $418,000 of debentures are converted on March 31, 2022. The market price of the common stock is then $116. Accrued interest at March 31 will be paid on the next interest date. Bond premium is amortized on a straight-line basis. Make the necessary journal entries for: (a) December 31, 2021. (c) (b) January 1, 2022. (d) Record the conversions 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 O for the amounts. Round answers to O decimal places, e.g. 5,275) Date Account Titles and Explanation Dec. 31. 2021 Interest Expense March 31, 2022. June 30, 2022. Premium on Bonds Payable Cash Debit 163020 4180 Credit 167200

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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