On September 1, 2025, Splish Company sold at 104 (plus accrued interest) 5,760 of its 9%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Splish Company bonds. Interest is payable on December 1 and June 1. Prepare in general journal format the entry to record the issuance of the bonds. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation September 1, 2025 Cash Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants Interest Payable Debit 6120000 LOOD Credit 5760000 207360 23040 129600
On September 1, 2025, Splish Company sold at 104 (plus accrued interest) 5,760 of its 9%, 10-year, $1,000 face value, nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share of common stock at a specified option price of $14 per share. Shortly after issuance, the warrants were quoted on the market for $3 each. No fair value can be determined for the Splish Company bonds. Interest is payable on December 1 and June 1. Prepare in general journal format the entry to record the issuance of the bonds. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation September 1, 2025 Cash Bonds Payable Premium on Bonds Payable Paid-in Capital-Stock Warrants Interest Payable Debit 6120000 LOOD Credit 5760000 207360 23040 129600
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 3C
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