A firm issues convertible bonds that pay 8% interest and receives $100,000 . The firm could have issued nonconvertible bonds that pay 8% interest but would have received only $80,000 in bond proceeds. What journal entry is necessary under GAAP to record the issuance of the convertible bonds?
a. Cash 100,000
Convertible Bonds Payable 80,000
Additional Paid-in Capital 20,000
b. Cash 100,000
Convertible Bonds Payable 80,000
Convertible Bond income 20,000
c. Cash 100,000
Convertible Bonds Payable 100,000
d. Convertible Bonds Payable 100,000
Cash 100,000
e. No entry is required
C
You might also like to view...
Conversion costs include ________.
A) direct labor and manufacturing overhead costs B) direct material and direct labor costs C) product and period costs D) direct material, direct labor, and manufacturing overhead costs
Members of focus groups are recruited using specific criteria
Indicate whether the statement is true or false
Discuss the definition, recognition, and measurement of revenue
Consider the network diagram given in Figure 1. Assume that the amount on each branch is the distance in miles between the respective nodes. What is the shortest route from the source node (node 1) to nodes 2, 3, and 4?
Indicate the total distance for each route.