Question 20 (10 points) Savna On January 1, 2020, Chestnut Corporation sold 3.000 of its $1,000 face value 10- year 9% non-convertible bonds with detachable stock warrants with an effective rate of 7% Bonds ex warrants (without warrants) have an effective rate of 10% on the market. Each bond carries two detachable warrants: each warrant is for one common share at a specified option price of $95 per share. The warrants can be exercised between January 1, 2025 and December 31, 2028 Annual interest payments are made on December 31, and discounts and premiums are amortized using the effective interest method. The company has a year end of December 31 Required: a Record the journal entry on the date of issue January 1, 2020. b. Complete all additional journal entries related to the bond in 2020 as appropriate c. Assume on January 1, 2025, the share is selling on the market for $225 and 700 warrants were exercisec. Record the joumal entry related to the warrant exercise. d. On December 31, 2028, the share price has plummeted to $80 on the market, and the rest of the warrants expire Record the journal entry related to the expiration of these remaining warrants. Question 20 (10 points) Savna On January 1, 2020, Chestnut Corporation sold 3.000 of its $1,000 face value 10- year 9% non-convertible bonds with detachable stock warrants with an effective rate of 7% Bonds ex warrants (without warrants) have an effective rate of 10% on the market. Each bond carries two detachable warrants: each warrant is for one common share at a specified option price of $95 per share. The warrants can be exercised between January 1, 2025 and December 31, 2028 Annual interest payments are made on December 31, and discounts and premiums are amortized using the effective interest method. The company has a year end of December 31 Required: a Record the journal entry on the date of issue January 1, 2020. b. Complete all additional journal entries related to the bond in 2020 as appropriate c. Assume on January 1, 2025, the share is selling on the market for $225 and 700 warrants were exercisec. Record the joumal entry related to the warrant exercise. d. On December 31, 2028, the share price has plummeted to $80 on the market, and the rest of the warrants expire Record the journal entry related to the expiration of these remaining warrants