Answered step by step
Verified Expert Solution
Question
1 Approved Answer
smadhill inc has decided to raise additional capita by issuing $162000 face value of bomds with a coupon rate of 9%. in discussions with investment
smadhill inc has decided to raise additional capita by issuing $162000 face value of bomds with a coupon rate of 9%. in discussions with investment bankers it was determined that to help the sale of the bomds detachable stock narrative should be issues at the rate of the one warrant for each $100 bomd sold. the value of the bomds without the warrants is considered to be $137700 and the value of the warrants in the market is $24300. the bomd sold in the market as issuance for $157000
Sandhili Inc, has decided to raise additional capltal by issuing $162.000 face value of bonds with a coupon rate of 9% in discussions with investment bankers, It was determined that to help the sale of the bonds, detachable stock warrants should be issued at the rate of one warrant for each $100 bond sold. The value of the bonds without the warrants is considered to be $137.700, and the value of the warrants in the market is $24,300. The bonds sold in the market at issuance for $157,000. (a) What entry should be made at the time of the issuance of the bonds and warrants? (Crodit occount titles are automatically indented When amount is entered. Do not indent manudin. If no entry is required, select "No Entry' for the occount titles and enter Ofor the amounts. Round intermed late calculations to 5 decimal places, es. 1.24687 and final answers to 0 decimal places es, 5,125.) a. what entry should be made at the time of the issuance of the bonds and warrants?
b. ppewpare the entry if the warrants were no detachable
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started