On March 1 of the current year (2022), Red Robin issued 725, 7.9% bonds with a face value of $1,000 each. The bonds are 10-year bonds and pay interest on August 31 and February 28th of each year. Each bond is convertible into 5 shares of common stock. The bonds sold for a total of $758,200. In addition, Red Robin incurred $21,933 of bond issue costs. There is not a beneficial conversion option with these bonds.
On March 1 of the current year (2022), Red Robin issued 725, 7.9% bonds with a face value of $1,000 each. The bonds are 10-year bonds and pay interest on August 31 and February 28th of each year. Each bond is convertible into 5 shares of common stock. The bonds sold for a total of $758,200. In addition, Red Robin incurred $21,933 of bond issue costs. There is not a beneficial conversion option with these bonds.
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter14: Long-term Liabilities: Bonds And Notes
Section: Chapter Questions
Problem 8E
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