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On May 31, 2020, Al-Mahed Company issued 1,000, 14%, 10-year $1.000 bonds at 105. Each bond was issued with one detachable stock warrant. Shortly after
On May 31, 2020, Al-Mahed Company issued 1,000, 14%, 10-year $1.000 bonds at 105. Each bond was issued with one detachable stock warrant. Shortly after issuance, the bonds were selling at 102, while the market value of the warrants is $8.. Prepare the issuance entry. 'a. Debit- Cash $1,050,000; Discount on BP 30,000 || Credit- Bonds Payable $1,000,000; PIC- Stock Warrants 80,000. O b. Debit- Cash $1,050,000 || Credit- Bonds Payable $1,000,000; Premium on BP 20.000; PIC- Stock Warrants 30,000. O c. Debit- Cash $1,050,000; Discount on BP 20,000 | | Credit- Bonds Payable $1.000.000; PIO- Stock Warrants 70,000.. d. Debit- Cash $1.050,000 || Credit- Bonds Payable $1.000.000; Premium on BP 41.828; PIC- Stock Warrants 8.172
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