13. XYZ Company issues $5,000,000 of bonds with a stated rate of 8% (5,000 at $1,000each). To

help with the sale, detachable warrants are issues at the rate of ten (10) warrants for each $1,000

bond sold. It is estimated that the value of the bonds without the warrants is $4,935,000 and the

value of the warrants is $315,000. The bonds with the warrants sold at 101. Hint: Use proportional method.

a. Prepare the journal entry to record the sale of the bonds with the detachable warrants.

b. Prepare the journal entry to record the sale of the bonds if the warrants were undetachable (use same selling price).