On January 1, 2021, Madison Products issued $41.2 million of 8%, 10-year convertible bonds at a net price of $42.12 million. Madisonrecently issued similar, but nonconvertible, bonds at 97 (that is, 97% of face amount). The bonds pay interest on June 30 andDecember 31. Each $1,000 bond is convertible into 30 shares of Madison's no par common stock. Madison records interest by thestraight-line method.On June 1, 2023, Madison notified bondholders of its intent to call the bonds at face value plus a 1% call premium on July 1, 2023. ByJune 30, all bondholders had chosen to convert their bonds into shares as of the interest payment date. On June 30, Madison paid thesemiannual interest and issued the requisite number of shares for the bonds being converted.Required:1. & 2. Prepare the journal entries for the issuance of the bonds by Madison and interest payment for June 30, 2021.3. Prepare the journal entries for the June 30, 2023, interest payment by Madison and the conversion of the bonds (book valuemethod).Complete this question by entering your answers in the tabs below.Req 1 and 2Prepare the journal entries for the June 30, 2023, interest payment by Madison and the conversion of the bonds (book value method).(If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in wholedollars.)Req 3View transaction list12Record the interest payment.Record the conversion of the bonds.EXCredit> On January 1, 2021, Madison Products issued $41.2 million of 8%, 10-year convertible bonds at a net price of $42.12 million. Madisonrecently issued similar, but nonconvertible, bonds at 97 (that is, 97% of face amount). The bonds pay interest on June 30 andDecember 31. Each $1,000 bond is convertible into 30 shares of Madison's no par common stock. Madison records interest by thestraight-line method.On June 1, 2023, Madison notified bondholders of its intent to call the bonds at face value plus a 1% call premium on July 1, 2023. ByJune 30, all bondholders had chosen to convert their bonds into shares as of the interest payment date. On June 30, Madison paid thesemiannual interest and issued the requisite number of shares for the bonds being converted.Required:1. & 2. Prepare the journal entries for the issuance of the bonds by Madison and interest payment for June 30, 2021.3. Prepare the journal entries for the June 30, 2023, interest payment by Madison and the conversion of the bonds (book valuemethod).Complete this question by entering your answers in the tabs below.Req 1 and 2Req 3Prepare the journal entries for the issuance of the bonds by Madison and interest payment for June 30, 2021. (If no entry is required fora transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)View transaction list1 Record the issuance of the bonds by Madison.2 Record the interest payment.EX>

Bonds This are the units of corporate debt issued by corporate companies and it securitized as…

On January 1, 2021, Madison Products issued $41.2 million of 8%, 10-year convertible bonds at a net price of $42.12 million. Madison recently issued similar, but nonconvertible, bonds at 97 (that is, 97% of face amount). The bonds pay interest on June 30 and December 31. Each $1,000 bond is convertible into 30 shares of Madison's no par common stock. Madison records interest by the straight-line method. On June 1, 2023, Madison notified bondholders of its intent to call the bonds at face value plus a 1% call premium on July 1, 2023. By June 30, all bondholders had chosen to convert their bonds into shares as of the interest payment date. On June 30, Madison paid the semiannual interest and issued the requisite number of shares for the bonds being converted. Required: 1. & 2. Prepare the journal entries for the issuance of the bonds by Madison and interest payment for June 30, 2021. 3. Prepare the journal entries for the June 30, 2023, interest payment by Madison and the conversion of the bonds (book value method). Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Prepare the journal entries for the June 30, 2023, interest payment by Madison and the conversion of the bonds (book value method). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) View transaction list 1 Record the interest payment. 2 Record the conversion of the bonds. ………. EX

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 4EB: Chung Inc. issued $50,000 of 3-year bonds on January 1, 2018, with a stated rate of 4% and a market...