(b) Assume the same facts as part (a), except that the warrants had a fair value of $23. Prepare the entry to record the issuance of thebonds and warrants. (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. Round intermediate calculations to 5 decimal places, eg. 1.24687 and finalanswers to 0 decimal places, eg. 5,125.)Account Titles and ExplanationDebitCreditCash1,938,000ASAENGINTLPriSF2F4F5F6F7F8F9F10F11F12&78.T.YGKFL On May 1, 2020, Marigold Company issued 1,900 $1,000 bonds at 102. Each bond was issued with one detachable stock warrant.Shortly after issuance, the bonds were selling at 97, but the fair value of the warrants cannot be determined.(a) Prepare the entry to record the issuance of the bonds and warrants. (Credit account titles are automatically indented when amount isentered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)Account Titles and ExplanationDebitCreditCash1,938,000Discount on Bonds Payable57,000Bonds Payable1,900,000Paid-in Capital-Stock Warrants95,000WASA* FACF5F9F6

Solution:- a)Preparation of the entry to record the issuance of the bonds and warrants as follows…

(b) Assume the same facts as part (a), except that the warrants had a fair value of $23. Prepare the entry to record the issuance of the bonds and warrants. (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. Round intermediate calculations to 5 decimal places, eg. 1.24687 and final answers to 0 decimal places, eg. 5,125.) Account Titles and Explanation Debit Credit Cash 1.020 000

(b) Assume the same facts as part (a), except that the warrants had a fair value of $23. Prepare the entry to record the issuance of the bonds and warrants. (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. Round intermediate calculations to 5 decimal places, eg. 1.24687 and final answers to 0 decimal places, eg. 5,125.) Account Titles and Explanation Debit Credit Cash 1.020 000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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