On July 1, 2023, Tien Limited called its 9% convertible bonds for conversion. The $10 million of par value bonds were converted into 1 million common shares. On July 1, there was $75,000 of unamortized discount applicable to the bonds, and the company paid an additional $65,000 to the bondholders to induce conversion of all the bonds. At the time of conversion, the balance in the account Contributed Surplus-Conversion Rights was $270,000, and the bond's fair value (ignoring the conversion feature) was $9,955,000. The company records conversion using the book value method. Prepare the journal entries if Tien prepares its financial statements using IFRS and if it uses ASPE.
On July 1, 2023, Tien Limited called its 9% convertible bonds for conversion. The $10 million of par value bonds were converted into 1 million common shares. On July 1, there was $75,000 of unamortized discount applicable to the bonds, and the company paid an additional $65,000 to the bondholders to induce conversion of all the bonds. At the time of conversion, the balance in the account Contributed Surplus-Conversion Rights was $270,000, and the bond's fair value (ignoring the conversion feature) was $9,955,000. The company records conversion using the book value method. Prepare the journal entries if Tien prepares its financial statements using IFRS and if it uses ASPE.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:On July 1, 2023, Tien Limited called its 9% convertible bonds for conversion. The $10 million of par value bonds were
converted into 1 million common shares. On July 1, there was $75,000 of unamortized discount applicable to the bonds,
and the company paid an additional $65,000 to the bondholders to induce conversion of all the bonds. At the time of
conversion, the balance in the account Contributed Surplus-Conversion Rights was $270,000, and the bond's fair value
(ignoring the conversion feature) was $9,955,000. The company records conversion using the book value method.
Prepare the journal entries if Tien prepares its financial statements using IFRS and if it uses ASPE.
Can someone please explain what the difference is between IFRS and ASPE and how they got the number in the journal
entries, thanks!
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