On January 1, 2021, Starlight Company converted $150,000 bonds into 90,000 shares of $1 par value common stock. The bonds were issued at face value. On the date of the conversion, the stocks had a market price of $6 per share.which one is correct? OptionsAccount TitlesDr.Cr.Bonds Payable540.000ACommon Stock90,000Paid-in Capital in Excess of Par - Common Stock450,000Bonds Payable150.000Common Stock150,000Bonds Payable150,000Common Stock90,000Paid-in Capital in Excess of Par -Common Stock60,000Bonds Payable90 000DCommon Stock90,000

The bonds are the financial instruments used by the business to raise money from the investors of…

On January 1, 2021, Starlight Company converted $150,000 bonds into 90,000 shares of $1 par value common stock. The bonds were issued at face value. On the date of the conversion, the stocks had a market price of $6 per share. which one is correct?

On January 1, 2021, Starlight Company converted $150,000 bonds into 90,000 shares of $1 par value common stock. The bonds were issued at face value. On the date of the conversion, the stocks had a market price of $6 per share. which one is correct?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Prepare the journal entry to record the original issuance of the convertible debentures. 2. Prepare…

A: 1. Journal entry to record the original issuance of the convertible debentures. Date Account…

Q: On January 1, 2021, Tonge Industries had outstanding 760,000 common shares ($1 par) that originally…

A: Answer:- Formula:- Earnings per share = (Net income - Preferred dividends) / Weighted average of…

Q: Sweet Company has bonds payable outstanding in the amount of $650,000, and the Premium on Bonds…

A: The organization can raise funds for the operation by issuing common stock, preferred stock for…

Q: Pronghorn Company has the following portfolio of investment securities at September 30, 2025, its…

A: Investments refer to investments made in stocks or shares or instruments of other entities and it…

Q: On January 1, 2018, when its $30 par value common stock was selling for$80 per share, a corporation…

A: Journal entry is the primary reporting of the transactions in the account books.

Q: Bonita Industries, has 4230000 shares of common stock outstanding on December 31, 2020. An…

A: Since Bonita issued 19000, $1,000 face value, 8% convertible bonds each will be converted into 20…

Q: Oriole Company had 196000 shares of common stock, 19200 shares of convertible preferred stock, and…

A: When all the convertible securities of the company are converted, then the EPS (Earning per share)…

Q: - preferred stock outs cumulative or conver dividends of $300,000 eholders, respectivel-

A: No. of Shares convertible from bonds = (2,000,000/1,000)*5…

Q: Concord Corporation had 199000 shares of common stock, 20700 shares of convertible preferred stock,…

A: The computation of the Basic earnings per share for 2021 is as follows:

Q: On January 1, 2019, when its $30 par value common stock was selling for $80 per share, Swifty Corp.…

A: Journal entry is an art of recording, summarizing and classifying business transactions into…

Q: On December 31, 2021, Ambient Corporation had 200,000 shares of common stock outstanding. On July 1,…

A: Basic earnings per share = (Net income - preferred dividend)/Weighted average outstanding common…

Q: Prepare the journal entry to record the original issuance of the convertible debentures. 2. Prepare…

Q: On January 1, 2019, when its $30 par value common stock was selling for $80 per share, Monty Corp.…

A: Journal entry is an art of recording, summarizing and classifying business transactions into…

Q: On January 1, 2019, when its $30 par value common stock was selling for $80 per share, Nash Corp.…

A: The journal entries would be as follows:

Q: Flint Corporation has outstanding 1,900 $1,000 bonds, each convertible into 70 shares of $10 par…

A: Bonds are a form of loan or debt being taken by the business. Bonds can be convertible or non…

Q: Grouper Company has bonds payable outstanding in the amount of $350,000, and the Premium on Bonds…

A: A bond is borrowing security issued by a company to raise funds from the market by making an…

Q: Grouper Company has bonds payable outstanding in the amount of $350,000, and the Premium on Bonds…

A: Grouper Company already issued 350 bonds ($350,000/$1,000). Now, each bond is converted to 20…

Q: On January 1, 2024, when its $30 par value common stock was selling for $80 per share, Crane Corp.…

A: Bond refers to the financial instrument issued by the government or the financial institutions for…

Q: Bentley Corporation received cash from issuing 13,000 shares of common stock at par on January 1,…

A: In the given question, the Corporation has issued 13,000 shares at par. The par value per share is $…

Q: Kimber Inc. reported net income of $177,500 during 2021. At January 1, 2021 Kimber had 100,000…

A: EPS stands for earning per share. A company has two types of EPS i.e basic and diluted. Basic EPS is…

Q: 16 .During 2021, Sysco Corp. had 1,000,000 shares of common stock and 60,000 shares of 10% preferred…

A: No. of shares convertible from bonds = = (2,200,000/1,000) x 5 = 2,200 x 5 = 11,000 shares Total…

Q: Q Co. had 200,000 ordinary shares, 20,000 shares of convertible preference shares, and $1,000,000 of…

A: EPS is earnings per share that available for all shareholders and that is income remaining after…

Q: A company has outstanding 366 $1,000 bonds, each convertible into 28 shares of $12 par value common…

A: Bonds payable = 366 * $ 1000 = $ 366000 Common Stock = 366 * 28 shares * $ 12 par value = $ 122976

Q: The information below pertains to Metlock Company for 2026. Net income for the year 7% convertible…

A: The whole amount of net income a business makes for each outstanding common share is known as the…

Q: During 2021, Omnicom Corp had 1,000,000 shares of common stock and 60,000 shares of 6% preferred…

A: Earnings-Per-Share(EPS) refers to portion to net profit that pertains to each individual common…

Q: The information below pertains to Coronado Company for 2021. Net income for the year 7% convertible…

A: Basic earnings per share Basic earnings per share refers to a firm's net income was allotted to each…

Q: Splish Corporation has outstanding 2,200 $1,000 bonds, each convertible into 50 shares of $10 par…

A: Bonds are a form of debt taken by the company. Convertible bonds are those bonds which can be…

Q: Buffalo Corporation has outstanding 1,900 $1,000 bonds, each convertible into 60 shares of $10 par…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: The Sirap Corp. issued 20000 shares of Common Stock $1 Par at $25 on 1/3/17. The following…

A: The journal entries are prepared to record the transactions on regular basis. The additional paid in…

Q: Waterway Industries had 200000 shares of common stock, 19300 shares of convertible preferred stock,…

A: Diluted Earnings Per Share: The diluted earnings per share (diluted EPS) of a corporation is…

Q: (a) Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. $2.55.)…

A: Diluted Earnings per share is a financial metric that represents a company's earning per share,…

Q: The information below pertains to Pierpont Corp. for 202 Net income, $1,200,000. Common Stock, $10…

A: The formula for calculating basic EPS involves dividing net income by the number of common shares…

Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

which one is correct?

Options
Account Titles
Dr.
Cr.
Bonds Payable
540.000
A
Common Stock
90,000
Paid-in Capital in Excess of Par - Common Stock
450,000
Bonds Payable
150.000
Common Stock
150,000
Bonds Payable
150,000
Common Stock
90,000
Paid-in Capital in Excess of Par -Common Stock
60,000
Bonds Payable
90 000
D
Common Stock
90,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1 Introduction

VIEW

Step 2 Solution

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The information below pertains to Windsor Company for 2026. Net income for the year 7% convertible bonds issued at par ($1,000 per bond); each bond is convertible into 30 shares of common stock 6% convertible, cumulative preferred stock, $100 par value; each share is convertible into 3 shares of common stock Common stock, $10 par value Tax rate for 2026 Average market price of common stock 4 a. Compute basic earnings per share for 2026. (Round answer to 2 decimal places, e.g. 2.55.) Basic earnings per share $ b. Compute diluted earnings per share for 2026. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share There were no changes during 2026 in the number of common shares, preferred shares, or convertible bonds outstanding. There is no treasury stock. The company also has common stock options (granted in a prior year) to purchase 71,800 shares of common stock at $20 per share. eTextbook and Media 1.65 $ $1,210,00 1,970,00 4,200,00 5,820,00 20% $25 per shar ▶
Vaughn Corporation has outstanding 2,200 $1,000 bonds, each convertible into 50 shares of $10 par value common stock. The bonds are converted on December 31, 2020, when the unamortized discount is $34,400 and the market price of the stock is $21 per share.Record the conversion using the book value approach.
Buffalo Corporation has outstanding 2,200 $1,000 bonds, each convertible into 50 shares of $10 par value common stock. The bonds are converted on December 31, 2017, when the unamortized discount is $21,200 and the market price of the stock is $21 per share.Record the conversion using the book value approach
Blossom Corporation has outstanding 2,000 of $1,000 bonds, each convertible into 70 shares of $10 par value common stock. The bonds are converted on December 31, 2025, when the unamortized discount is $28,000 and the market price of the stock is $21 per share. Record the conversion using the book value approach. (List all debit entries before credit entries. 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.) Account Titles and Explanation Debit Credit
On January 1, 2020, Company D issued 6,000 shares of its $2 par Common Stock when the market price was $30 and issued 1,000 shares of its $25 par Preferred Stock when the market price was $62 per share. What amounts would be reported on the balance sheet for Preferred Stock and Paid-In Preferred Stock? the above information is all that was given on the assignment, no further information was given for the question
Kojak Corporation decided to issue common stock and used the $300,000 proceeds to redeem all of its outstanding bonds on January 1, 2022. The following information is available for the company for 2022 and 2021. Net income Dividends declared for preferred stockholders Average common stockholders' equity Total assets Current liabilities Total liabilities (a) Return on common stockholders' equity ratio (c1) 2022 2022 Debt to assets ratio $ 182,000 8,000 1,000,000. 1,200,000 100,000 200,000 2021 $ 150,000 8,000 700,000 Compute the return on common stockholders' equity for both years. (Round answers to 1 decimal place, e.g. 12.5%.) 1,200,000 100,000 500,000 enter return on common stockholders equity in percentages % Compute the debt to assets ratio for both years. (Round answers to 1 decimal place, e.g. 12.5%.) 2021 2022 2021 enter debt to assets ratio in percentages % enter return on common stockho enter debt to assets ratio in percentages %