Problem.On January 1, 2021, the company issued 10% 3-year 1,000,000 convertible bond at 102. Each 1,000 bond is convertible into 8 shareswith par value of 100 per share. On issuance date, the bonds were selling at 98 without the conversion option. The entity incurred50,000 transaction cost on the issuance. On December31, 2022, the bonds were converted into shares incurring an issuance cost of 80,000.

Requirements

1. Prepare the amortization table

2. Prepare the journal entry at conversion date

Please Answer

Reference:

Intermediate Accounting 2 by Millan: Notes and Bonds Payable