Pronghorn Corporation issued 5,400, five year, 3% bonds at 104 on January 1, 2020. Interest is paid annually. Each $1,000 bond carried one detachable warrant allowing the holder to purchase 100 common shares in Pronghorn at $10 per share, the price at which Pronghorn shares were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 6%. On June 30, 2020, 1,080 of the bond holders exercised the options to buy the shares. Prepare the journal entries to record these events. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1, 2020 Cash 5616,000 Bonds payable ? Contributed surplus - stock warrants ? Jun. 30, 2020 Cash 1,080,000 Contributed surplus - stock warrants ? common shares ? The journal entries and the cash amounts provided are correct just answer the one with question marks please and thank you!
Pronghorn Corporation issued 5,400, five year, 3% bonds at 104 on January 1, 2020. Interest is paid annually. Each $1,000 bond carried one detachable warrant allowing the holder to purchase 100 common shares in Pronghorn at $10 per share, the price at which Pronghorn shares were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 6%. On June 30, 2020, 1,080 of the bond holders exercised the options to buy the shares.
Prepare the
|
Date |
Account Titles and Explanation |
Debit |
Credit |
|
Jan. 1, 2020 |
Cash | 5616,000 | |
| Bonds payable | ? | ||
| Contributed surplus - stock warrants | ? | ||
|
Jun. 30, 2020 |
Cash | 1,080,000 | |
| Contributed surplus - stock warrants | ? | ||
| common shares | ? |
The journal entries and the cash amounts provided are correct just answer the one with question marks please and thank you!
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