Pharoah Inc. issued $ 1 5 , 9 0 0 , 0 0 0 of 1 2
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Question:
Pharoah Inc. issued $ of year convertible bonds on November at plus accrued interest. The bonds were dated July with interest payable January and July Bond discount premium is amortized semiannually on a straightline basis.
On July onehalf of these bonds were converted into shares of $ par value common stock. Accrued interest was paid in cash at the time of conversion.
a Prepare the entry to record the interest expense at December Assume that accrued interest payable was credited when the bonds were issued. Credit Interest Payable for the full amount due; debit Interest Payable for the amount recognized at insurance. Round to nearest dollar.
b Prepare the entry to record the conversion on July Book value method is used. Assume that the entry to record amortization of the bond discount and interest payment has been made.
Related Book For
Intermediate Accounting
ISBN: 978-1118147290
15th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield
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