Splish Corporation issued 4,000, five year, 4% bonds at 106 on January 1, 2023. Interest is paid annually. Each $1,000 bond carried one detachable warrant allowing the holder to purchase 100 common shares in Splish at $11 per share, the price at which Splish shares were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 5%. On June 30, 2023, 800 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 O decimal places e.g. 58,971. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Account Titles and Explanation Date ary 1, 2023 0, 2023 V Cash Bonds Payable Contributed Surplus - Stock Warrants Cash Contributed Surplus - Stock Warrants Common Shares Debit 4240000 880000 48000 Credit 4000000 240000 928000
Splish Corporation issued 4,000, five year, 4% bonds at 106 on January 1, 2023. Interest is paid annually. Each $1,000 bond carried one detachable warrant allowing the holder to purchase 100 common shares in Splish at $11 per share, the price at which Splish shares were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 5%. On June 30, 2023, 800 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 O decimal places e.g. 58,971. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Account Titles and Explanation Date ary 1, 2023 0, 2023 V Cash Bonds Payable Contributed Surplus - Stock Warrants Cash Contributed Surplus - Stock Warrants Common Shares Debit 4240000 880000 48000 Credit 4000000 240000 928000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Splish Corporation issued 4,000, five year, 4% bonds at 106 on January 1, 2023. Interest is paid annually. Each $1,000 bond carried one
detachable warrant allowing the holder to purchase 100 common shares in Splish at $11 per share, the price at which Splish shares
were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 5%. On June 30, 2023, 800 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 O decimal places e.g. 58,971. Credit account titles are automatically indented when the amount is entered. Do not indent manually.
Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter o for the
amounts. List all debit entries before credit entries.)
Date
ary 1, 2023
0, 2023
Account Titles and Explanation
Cash
Bonds Payable
Contributed Surplus - Stock Warrants
Cash
Contributed Surplus - Stock Warrants
Common Shares
Debit
4240000
880000
48000
Credit
4000000
240000
928000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faa4f8b7f-5983-4de5-ad25-1ed2edc45269%2Fc19d0d11-1fe8-4cc7-af2e-e8e0e167ae7d%2Fub0f6i6_processed.png&w=3840&q=75)
Transcribed Image Text:Splish Corporation issued 4,000, five year, 4% bonds at 106 on January 1, 2023. Interest is paid annually. Each $1,000 bond carried one
detachable warrant allowing the holder to purchase 100 common shares in Splish at $11 per share, the price at which Splish shares
were trading on the day of the sale of the bonds. Similar straight bonds trading on the open market paid 5%. On June 30, 2023, 800 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 O decimal places e.g. 58,971. Credit account titles are automatically indented when the amount is entered. Do not indent manually.
Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter o for the
amounts. List all debit entries before credit entries.)
Date
ary 1, 2023
0, 2023
Account Titles and Explanation
Cash
Bonds Payable
Contributed Surplus - Stock Warrants
Cash
Contributed Surplus - Stock Warrants
Common Shares
Debit
4240000
880000
48000
Credit
4000000
240000
928000
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