AC 302 Chapter 16 Question 1

AC 302 Chapter 16 Question 1
Name				Date		
Instructor				Course		
Intermediate Accounting 14th Edition by Kieso Weygandt and Warfield						
Primer on Using Excel in Accounting by Rex A Schildhouse						
						
"E16-1 (Issuance and Conversion of Bonds)
Instructions:
For each of the unrelated transactions described below, present the entry(ies) required to record each transaction."						
						
						
						
						
1. Coyle Corp. issued		$10,000,000 	par value	10%	convertible bonds at	
99 	If the bonds had not been convertible, the company's investment banker estimates 					
they would have been sold at		95 	Expenses of issuing the bonds were			$70,000 
						
	Account Title			Amount		
	Account Title			Amount		
	Account Title				Amount	
						
	Account Title			Amount		
	Account Title				Amount	
						
2. Lambert Company issued		$10,000,000 	par value	10%	bonds at	98 
   One detachable stock warrant was issued with each				$100 	par value bond. At the time	
 of issuance, the warrants were selling for				$4 		
						
	Account Title			Amount		
	Account Title			Amount		
	Account Title				Amount	
	Account Title				Amount	
						
	Text title				Formula	
	Text title				Formula	
	Text title				Formula	
						
"3. Sepracor, Inc. called its convertible debt in 2012. Assume the following related to the transaction:
"						
The	11%	$10,000,000 	par value bonds were converted into			1,000,000 
shares of	$1 	par value common stock on July 1, 2012. On July 1, there was				
$55,000 	of unamortized discount applicable to the bonds, and the company paid an additional					
$75,000 	to the bondholders to induce conversion of all the bonds. The company records the					
conversion using the book value method.						
						
	Account Title		75000	Amount		
	Account Title		10000000	Amount		
	Account Title				Amount	
	Account Title				Amount	
	Account Title				Formula	
	Account Title				Amount	
	* Calculation as desired.