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Dauphin Inc. issued a 10-year bond on July 1, 2019. The $20,000,000 par bond pays $700,000 of interest on December 31 and June 30. The
Dauphin Inc. issued a 10-year bond on July 1, 2019. The $20,000,000 par bond pays $700,000 of interest on December 31 and June 30. The company has a calendar year-end It is now February 2023. During the audit of the 2022 financial statements, it was discovered that the bond indenture allowed holders to convert the bonds to common shares. The terms of the conversion allow each $1,000 bond to be converted into 56 shares Additional investigation concluded that the bond would have yielded 14% per annum had it not included the conversion option. Required Record any adjusting journal entries required to correct Dauphin's accounts. The books for 2022 have not yet been closed. Date December 31, 2022 Accounts December 31, 2022 Bonds payable Contributed surplus-Bond conversion option Next, prepare the entry to correct interest recorded in prior periods (2019 to 2021), Date Accounts Retained earnings-Opening balance Bonds payable Finally, prepare the entry to correct interest recorded in 2022 Date December 31, 2022 Debi
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