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What accounts should Free credit to record the issuance of the bonds and warrants? a. Bonds Payable Premium on Bonds Payable i Paid-in Capital-Stock Warrants b. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants c. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants $6,000,000 232,800 127,200 $6,000,000 48,000 252,000 $6,000,000 105,600 254,400

What accounts should Free credit to record the issuance of the bonds and warrants? a. Bonds Payable Premium on Bonds Payable i Paid-in Capital-Stock Warrants b. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants c. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants $6,000,000 232,800 127,200 $6,000,000 48,000 252,000 $6,000,000 105,600 254,400

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The Free Corporation has common stock with a par value of $25 per share. On March 1, 2020, Free Corporation sold a $6,000,000, twenty- year, 8 percent bond issue for a total of $6,360,000. Each $1,000 bond has two detachable warrants, each of which permits the purchase of one share of the corporation's common stock for $30. Immediately after the sale of the bonds, the corporation's securities had the following market values: 8% bond without warrants Warrants Common stock a. Bonds Payable What accounts should Free credit to record the issuance of the bonds and warrants? Premium on Bonds Payable Paid-in Capital-Stock Warrants b. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants c. Bonds Payable Premium on Bonds Payable Paid-in Capital Stock Warrants d. Bonds Payable $1,008 21 Premiums on Bonds Payable 28 $6,000,000 232,800 127,200 $6,000,000 48,000 252,000 $6,000,000 105,600 254,400 ICILUATAC $6,000,000 360,000
Transcribed Image Text:The Free Corporation has common stock with a par value of $25 per share. On March 1, 2020, Free Corporation sold a $6,000,000, twenty- year, 8 percent bond issue for a total of $6,360,000. Each $1,000 bond has two detachable warrants, each of which permits the purchase of one share of the corporation's common stock for $30. Immediately after the sale of the bonds, the corporation's securities had the following market values: 8% bond without warrants Warrants Common stock a. Bonds Payable What accounts should Free credit to record the issuance of the bonds and warrants? Premium on Bonds Payable Paid-in Capital-Stock Warrants b. Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants c. Bonds Payable Premium on Bonds Payable Paid-in Capital Stock Warrants d. Bonds Payable $1,008 21 Premiums on Bonds Payable 28 $6,000,000 232,800 127,200 $6,000,000 48,000 252,000 $6,000,000 105,600 254,400 ICILUATAC $6,000,000 360,000
Select one: O a. Answer a O b. Answer b O c. Answer c O d. Answer d
Transcribed Image Text:Select one: O a. Answer a O b. Answer b O c. Answer c O d. Answer d
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