Question
Can you please help me to solve these problems? So that I can compare your solution on mine too. Thank you! 1. At the beginning
Can you please help me to solve these problems? So that I can compare your solution on mine too. Thank you!
1. At the beginning of current year, Jackfrost Company issued 5,000 convertible bonds payable. The bonds have a three-year term and are issued at 110 with a face amount of P1,000 per bond. Interest is payable annually in arrears at a nominal 6% interest rate. Each bond is convertible at anytime up to maturity into 100 ordinary shares with par value of P5. When the bonds are issued, the prevailing market interest rate for similar debt instrument without conversion option is 9%. The present value of 1 at 9% for 3 periods is .77 and the present value of an ordinary annuity of 1 at 9% for 3 periods is 2.53. What amount should be reported as equity component of the original issuance of the convertible bonds payable?
2. Case Cereal Company distributed coupons to promote new products. On October 1, 2019, the entity nailed 100,000 coupons for P45 off each box of cereal purchased. The entity expected 12,000 of these coupons to be redeemed before the December 31, 2019 expiration date. It takes 30 days from the redemption date for the entity to receive the coupons from the retailers. The entity reimbursed the retailers an additional P5 for each coupon redeemed. On December 31, 2019, the entity had paid retailers P250,000 related to these coupons and had 5,000 coupons on hand that had not been processed for payment. What amount should be reported as liability for coupons on December 31, 2019?
3. Webster Company commenced operations in the current year. A number of expenditures were made during the current year that were debited to one account intangible assets. (refer to data below) What total amount should be reported as intangible assets?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started