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3 years ago

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Hoffman Corporation issued $80 million of 8%, 20-year bonds at 105. Each of the 80,000 bonds was issued with 10 detachable stock

warrants, each of which entitled the bondholder to purchase, for $20, one share of $1 par common stock. At the time of sale, the market value of the common stock was $25 per share and the market value of each warrant was $7. Prepare the journal entry to record the issuance of the bonds.

1 answer:

Elis [28]3 years ago

5 0

Answer:

cash 84,000,000 debit

discount on BP 1,250,000 debit

bonds payable 80,000,000 credit

warrant of CS 5,250,000 credit

Explanation:

bond(1,000 x 105/100) 1050 93.75% (1050/1120)

warrant($7 x 10 per share) 70 6.25% (70/1120)

Total per share 1120

Cash proceeds: 80,000 x 1,000 x 105/100 = 84,000,000

Bonds x 93.75 = 78,750,000

Warrant x 6.25 = 5,250,000

Bonds face value 80,000,000

proceeds 78,750,000

discount 1,250,000

journal entry

cash 84,000,000 debit

discount on BP 1,250,000 debit

bonds payable 80,000,000 credit

warrant of CS 5,250,000 credit

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Answer:

A. The balance sheet reports the performance of the firm over the past period. It summaries and categorizes a company's revenues and expenses for that period.

Explanation:

The balance sheet is a financial document or statement that shows a company's total assets at a particular time. It indicates how the assets are financed. A balance sheet reports the net worth of a business. It shows the assets, the liabilities, and the shareholders' equity.

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Tanner-UNF Corporation acquired as a long-term investment $170 million of 6% bonds, dated July 1, on July 1, 2013. Company manag

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Answer:

1) The Investment would be classified as Held-to-maturity securities

2) Journal Entries (in millions)

Debit Investment $170 Credit Bank $140 Credit Discount on investment $30

3) Debit Bank $5.1 Debit Discount on investment $0.5 Credit Interest Income $5.6

4) Debit Fair Value loss $20 Credit Investment $20

5) The investment will be reported at the fair value of $150,000

6) Debit Bank $120 Debit Discount on Investment $29.5 Loss on Investment $0.5 Credit Investment $150,000

Explanation:

Interest = investment * semiannual interest

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An asset has an average historical rate of return of 10.1 percent and a variance of 0.0116751. What is the upper percentage rang

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Answer:

20.91%

Explanation:

Provided information

Average historical rate of return = 10.1 %

Variance = 0.0116751

By considering the above information, the standard deviation would be

= Square root of Variance

= 10.81%

So the upper percentage range of return would be

= Standard deviation + standard deviation

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Since we have to find out the upper percentage so we added it otherwise we have to deduct it

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Solution:

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Raw material: a fundamental substance in its natural, changed or semi-managed condition, used as a contribution to the cycle of production for the eventual modification or transformation into a finished decent substance.

Pass journal entry

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Work in process 186,000

Raw material inventory 186,000

Factory overhead 15,000

Raw material inventory 15,000

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