Essay
On December 31, 2009, the balance sheet of L and H Corporation reported bonds outstanding with a face value of $5 1,000,000 and a related unamortized premium of $2 50,000. Interest is payable semiannually on January 1 and July 1.
a. Prepare an entry in journal form without explanations to record the retirement of bonds with a face value of $3 600,000 on January 1, 2010, assuming the bonds were redeemed at a call price of 103.
b. Prepare an entry in journal form without explanation on January 1, 2010, to record the conversion of bonds with a face value of $2 400,000 into common stock. Each $1,000 bond is convertible into 25 shares of $10 par value common stock.
Correct Answer:
Verified
Correct Answer:
Verified
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