par Marigold Corporation is a regional company which is an SEC registrant. The corporation's securities are thinly traded on NASDAQ. Marigold Corp. has issued 12,000 units. Each unit consists of a $660 par value, 12% subordinated debenture and 10 shares of $6 common stock. The units were sold to outside investors for cash at $1,056 per unit. Prior to this sale, the 2-week ask price of common stock was $44 per share. Twelve percent is a reasonable market yield for the debentures, and therefore the par value of the bonds is equal to the fair value. (a) Prepare the journal entry to record Marigold's transaction, under the following conditions. (List all debit entries before credit entries. Do not round intermediate calculations. Round final answers to O decimal places, e.g. 38,487. Credit account titles are automatically indented when the 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.) 1. Employing the incremental method. 2. Employing the proportional method, assuming the recent price quote on the common stock reflects fair value. No. Account Titles and Explanation 1. 2. Debit Credit
par Marigold Corporation is a regional company which is an SEC registrant. The corporation's securities are thinly traded on NASDAQ. Marigold Corp. has issued 12,000 units. Each unit consists of a $660 par value, 12% subordinated debenture and 10 shares of $6 common stock. The units were sold to outside investors for cash at $1,056 per unit. Prior to this sale, the 2-week ask price of common stock was $44 per share. Twelve percent is a reasonable market yield for the debentures, and therefore the par value of the bonds is equal to the fair value. (a) Prepare the journal entry to record Marigold's transaction, under the following conditions. (List all debit entries before credit entries. Do not round intermediate calculations. Round final answers to O decimal places, e.g. 38,487. Credit account titles are automatically indented when the 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.) 1. Employing the incremental method. 2. Employing the proportional method, assuming the recent price quote on the common stock reflects fair value. No. Account Titles and Explanation 1. 2. Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Marigold Corporation is a regional company which is an SEC registrant. The corporation's securities are thinly traded on NASDAQ.
Marigold Corp. has issued 12,000 units. Each unit consists of a $660 par value, 12% subordinated debenture and 10 shares of $6
common stock. The units were sold to outside investors for cash at $1,056 per unit. Prior to this sale, the 2-week ask price of common
stock was $44 per share. Twelve percent is a reasonable market yield for the debentures, and therefore the par value of the bonds is
equal to the fair value.
(a) Prepare the journal entry to record Marigold's transaction, under the following conditions. (List all debit entries before credit entries.
Do not round intermediate calculations. Round final answers to O decimal places, e.g. 38,487. Credit account titles are automatically indented
when the 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.)
1.
Employing the incremental method.
2.
Employing the proportional method, assuming the recent price quote on the common stock reflects fair value.
No. Account Titles and Explanation
1.
2.
Debit
Credit
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