《Intermediate Accouting Chapter to .docx》由会员分享，可在线阅读，更多相关《Intermediate Accouting Chapter to .docx（15页珍藏版）》请在金锄头文库上搜索。
1、BE16-1 Archer Inc. issued $4,000,000 par value, 7% convertible bonds at 99 for cash. If the bonds had not included the conversion feature, they would have sold for 95. Prepare the journal entry to record the issuance of the bonds. Cash 3,960,000 Discount on Bonds Payable 40,000 Bonds Payable 4,000,0
2、00BE16-2 Petrenko Corporation has outstanding 2,000 $1,000 bonds, each convertible into 50 shares of $10 par value common stock. The bonds are converted on December 31, 2012, when the unamortized discountis $30,000 and the market price of the stock is $21 per share. Record the conversion using the b
3、ook value approach.Bonds Payable 2,000,000 Discount on Bonds Payable 30,000Common Stock (2,000 X 50 X $10) 1,000,000Paid-in Capital in Excess of ParCommon Stock 970,000BE16-3 Pechstein Corporation issued 2,000 shares of $10 par value common stock upon conversion of 1,000 shares of $50 par value pref
4、erred stock. The preferred stock was originally issued at $60 per share. The common stock is trading at $26 per share at the time of conversion. Record the conversion of the preferred stock.Preferred Stock (1,000 X $50) 50,000Paid-in Capital in Excess of Par - Preferred Stock ($60 - $50) X 1,000 10,
5、000Cr. Common Stock (2,000 X $10) 20,000Cr. Paid-in Capital in Excess of ParCommon Stock ($60 X 1,000) - (2,000 X $10) 40,000 BE16-4 Eisler Corporation issued 2,000 $1,000 bonds at 101. Each bond was issued with one detachable stock warrant. After issuance, the bonds were selling in the market at 98
6、, and the warrants had a market price of $40. Use the proportional method to record the issuance of the bonds and warrants. De. Cash 2,020,000De. Discount on Bonds Payable ($2,000,000 - $1,940,784) 59,216Cr. Bonds Payable 2,000,000Cr. Paid-in CapitalStock Warrants 79,216Work up:Fair value of bonds (
7、2,000 X $1,000 X .98) $1,960,000Fair value of warrants (2,000 X $40) 80,000EqualAggregate fair value $2,040,000Allocated to bonds ($1,960/$2,040) X $2,020,000 $1,940,784Allocated to warrants ($80/$2,040) X $2,020,000 79,216$2,020,000BE16-5 McIntyre Corporation issued 2,000 $1,000 bonds at 101. Each
8、bond was issued with one detachable stock warrant. After issuance, the bonds were selling separately at 98. The market price of the warrants without the bonds cannot be determined. Use the incremental method to record the issuance of the bonds and warrants. De. Cash 2,020,000De. Discount on Bonds Pa
9、yable $2,000,000 X (1 - .98) 40,000Cr. Bonds Payable 2,000,000Cr. Paid-in CapitalStock Warrants 60,000*$2,000,000 X (1.01 - .98)On January 1, 2012, Barwood Corporation granted 5,000 options to executives. Each option entitles the holder to purchase one share of Barwoods $5 par value common stock at
10、$50 per share at any time during the next 5 years. The market price of the stock is $65 per share on the date of grant. The fair value of the options at the grant date is $150,000. The period of benefit is 2 years. Prepare Barwoods journal entries for January 1, 2012, and December 31, 2014 and 2015.
11、1/1/12 No entry12/31/12 De. Compensation Expense 75,000Cr. Paid-in CapitalStock Options 75,00012/31/13 De. Compensation Expense 75,000Cr. Paid-in CapitalStock Options 75,000E16-1(Issuance and Conversion of Bonds) For each of the unrelated transactions described below, present the entry(ies) required
12、 to record each transaction. 1. Grand Corp. issued $20,000,000 par value 10% convertible bonds at 99. If the bonds had not been convertible, the companys investment banker estimates they would have been sold at 95. Expenses of issuing the bonds were $70,000. 1.Cash ($20,000,000 X .99)19,800,000Disco
13、unt on Bonds Payable200,000Bonds Payable20,000,000Unamortized Bond Issue Costs70,000Cash70,0002. Hoosier Company issued $20,000,000 par value 10% bonds at 98. One detachable stock purchase warrant was issued with each $100 par value bond. At the time of issuance, the warrants were selling for $4. 2.
14、Cash19,600,000Discount on Bonds Payable1,200,000Bonds Payable20,000,000Paid-in CapitalStock Warrants800,000Value of bonds plus warrants ($20,000,000 X .98)$19,600,000Value of warrants (200,000 X $4) 800,000Value of bonds$18,800,0003. Sepracor, Inc. called its convertible debt in 2007. Assume the fol
15、lowing related to the transaction: The 11%, $10,000,000 par value bonds were converted into 1,000,000 shares of $1 par value common stock on July 1, 2007. On July 1, there was $55,000 of unamortized discount applicable to the bonds, and the company paid an additional $75,000 to the bondholders to induce conversion of all the bonds. The company records the conversion using the book value method. 3.Debt Conversion Expense75,000Bonds Payable10,000,000Disc
