Requirement #2?

and 1 to 3

On August 1, 2018, Limbaugh Communications issued $20 million of 10% nonconvertible bonds at 104. The bonds are due on July 31, 2038. Each $1,000 bond was issued with 30 detachable stock warrants, each of which entitled the bondholder to purchase, for $50, one share of Limbaugh Communications' no par common stock. Interstate Containers purchased 20% of the bond issue. On August 1, 2018, the market value of the common stock was $47 per share and the market value of each warrant was $6. In February 2029 when Limbaugh's common stock had a market price of $60 per share and the unamortized discount balance was $1 million, Interstate Containers exercised the warrants it held. Required: 1. Prepare the journal entries on August 1, 2018, to record (a) the issuance of the bonds by Limbaugh and (b) the investment by Interstate. 2. Prepare the journal entries for both Limbaugh and Interstate in February 2029, to record the exercise of the warrants. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the journal entries for both Limbaugh and Interstate in February 2029, to record the exercise of the warrants. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in millions and round to 2 decimal places (1.e., 5,500,000 should be entered as 5.50)). On January 1, 2018, Rapid Airlines issued $225 million of its 8% bonds for $207 million. The bonds were priced to yield 10% Interest is payable semiannually on June 30 and December 31. Rapid Airlines records interest at the effective rate and elected the option to report these bonds at their fair value. On December 31, 2018, the fair value of the bonds was $213 million as determined by their market value in the over-the-counter market. Rapid determined that $1,000,000 of the increase in fair value was due to a decline in general interest rates Required: 1. to 3. Prepare the journal entry to record interest on June 30, 2018 (the first interest payment), on December 31, 2018 (the second interest payment and adjust the bonds to their fair value for presentation in the December 31, 2018, balance sheet. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in whole dollars.) View transaction list Journal entry worksheet 2 3 Record entry to interest on June 30, 2018 (the first interest payment). Nord bore credits Date General Journal Debit Credit June 30, 2018 Record entry entry View general Journal