Question
Consider the 4.75% convertible notes due December 2006. As;mme that interest is paid annually. What is the face value (or principal) of these notes? What
Consider the 4.75% convertible notes due December 2006. As;mme that interest is paid annually.
What is the face value (or principal) of these notes?
What is the carrying value (net book value) of these notes?
Why do the two values differ?
How much interest did Rite Aid pay on these notes during the fiscal 2004?
Determine interest expense on these notes for the year ended February 28, 2004. Note that there are cash and non-cash portion to interest expense on these notes because they were issued at a discount. The non-cash portion of interest expense is the amortization of the discount during the year (that is, the amount by which the discount decreased during the year).
RITE AID CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except per share amounts) March Februl 2003 ASSETS Current assets: 334,755 365,32 Cash and cash equivalents 575,518 670,004 Accounts receivable, net 2,223,17 2,195,030 50,067 08,018 nventories, ne Prepaid expenses and other current assets 3,243,887 3,377,997 Total current assets 1,868,579 1,883,808 Property, plant and equipment, net 684,535 684,535 Goodwi 176,672 99,768 Other angibles, net 36,7 Other assets 6,133,515 6,246,679 Total assets LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT Current liabilities: Short-term debt and current maturities of convertible notes, 23,976 103,715 ong g-term debt and lease financing obligations 755,284 758.290 Accounts payable 707,999 Accrued salaries, wages and other current liabilities 20,484 Total current liabilities 1,483,750 ,566,998 246,000 244,500 Convertible notes 3,451,352 3,345,365 Long-term debt, less current maturities 170,338 69.048 Lease financing obligations, less current maturities 975 900,270 Other noncurrent liabilities 6,237,415 6.226,18 Tota abilities Commitments and contingencies 9,663 Redeemable preferred stock Stockholders' equity (deficit): Preferred stock, par value $1 per share: liquidation value $100 per hare: 20,000 shares authorized shares issued 4,178 393,705 417,803 and 3.937 Common stock, par value $1 per share: 1.000,000 shares authorized: 516,496 515,115 shares issued and outstanding 516496 and 515,115 3,119,619 3,133,277 Additional paid-in capital (4.035.433) (4,118,119 Accumulated defici 5,369 Stock based and deferred compensation Accumulated other comprehensive loss 329 tal stockholders' equity (defici 6,133,515 6,246,679 Total liabilities and stockholders' equity (deficit). The accompanying notes are an integral part of these consolidated financial statements, 41 .192. -191Step by Step Solution
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