Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On March 1, 2022, Hanako Sports issued 4,000,000,000 of 10.5%,10-year bonds for 4,122,880,000. The bonds yield 10%. Interest. payment dates are March 1 and September

image text in transcribed
On March 1, 2022, Hanako Sports issued 4,000,000,000 of 10.5%,10-year bonds for 4,122,880,000. The bonds yield 10%. Interest. payment dates are March 1 and September 1. On February 1, 2023, Hanako took advantage of favorable prices of its stock to extinguish 500,000,000 of the bonds by issuing 150,000,100 par ordinary shares. At this time, the accrued interest was paid in cash. The company's stock was selling for 3,500 per share on February 1, 2023. Prepare the journal entries needed on the books of Hanako Sports to record the following. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select " No Entry" for the occount titles and enter 0 for the amounts. Round answers to 0 decimal places, eg. 38,548 .) (a) March 1, 2022: issuance of the bonds. (b) September 1, 2022: payment of semiannual interest. (c) December 31, 2022: accrual of interest expense. (d) February 1, 2023: extinguishment of bonds. (No reversing entries made.) On March 1, 2022, Hanako Sports issued 4,000,000,000 of 10.5%,10-year bonds for 4,122,880,000. The bonds yield 10%. Interest. payment dates are March 1 and September 1. On February 1, 2023, Hanako took advantage of favorable prices of its stock to extinguish 500,000,000 of the bonds by issuing 150,000,100 par ordinary shares. At this time, the accrued interest was paid in cash. The company's stock was selling for 3,500 per share on February 1, 2023. Prepare the journal entries needed on the books of Hanako Sports to record the following. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select " No Entry" for the occount titles and enter 0 for the amounts. Round answers to 0 decimal places, eg. 38,548 .) (a) March 1, 2022: issuance of the bonds. (b) September 1, 2022: payment of semiannual interest. (c) December 31, 2022: accrual of interest expense. (d) February 1, 2023: extinguishment of bonds. (No reversing entries made.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Accounting

Authors: Greg Shields

1st Edition

1647484286, 978-1647484286

More Books

Students also viewed these Accounting questions

Question

Name the Crystallographic Direction and show how you got it.

Answered: 1 week ago