Sandhill Co. has $3890000 of 7% convertible bonds outstanding. Each $1000 bond is convertible common stock. The bonds pay interest on January 31 and July 31. On July 31, 2025, the holders o conversion privilege. On that date, the market price of the bonds was 105 and the market price of total unamortized bond premium at the date of conversion was $288000. Sandhill should record, O loss of $11670. O credit of $176700.00 to Paid-in Capital in Excess of Par. O credit of $203100 to Paid-in Capital in Excess of Par. O credit of $92160 to Premium on Bonds Payable.
Sandhill Co. has $3890000 of 7% convertible bonds outstanding. Each $1000 bond is convertible common stock. The bonds pay interest on January 31 and July 31. On July 31, 2025, the holders o conversion privilege. On that date, the market price of the bonds was 105 and the market price of total unamortized bond premium at the date of conversion was $288000. Sandhill should record, O loss of $11670. O credit of $176700.00 to Paid-in Capital in Excess of Par. O credit of $203100 to Paid-in Capital in Excess of Par. O credit of $92160 to Premium on Bonds Payable.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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