The company has bonds payable with a total face value of $100,000 and a carrying value of
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The company has bonds payable with a total face value of $100,000 and a carrying value of $96,000.In addition, unpaid interest on the bonds has been accrued in the amount of $5,000. The lender has agreed to the settlement of the bonds in exchange for 10,000 shares of $1 par common stock. The shares have a current market value of $90,000. Make the journal entry necessary on the books of the borrower to record this settlement of the bonds payable.
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...
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Bonds Payable 100000 Interest Payable 500...View the full answer
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Related Book For 
Intermediate Accounting
ISBN: 978-0324312140
16th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
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