Assume that Motorola, Inc., issues bonds with a face value of $10,000,000 for $9,200,000. The bonds have

Question:

Assume that Motorola, Inc., issues bonds with a face value of $10,000,000 for $9,200,000. The bonds have detachable warrants that may be traded in for shares of common stock. Assume that immediately after issue, bonds with warrants detached trade for $9,000,000; the warrants, for $400,000. Use the template below to show the financial statement effects at the date of issue.

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...