6. On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865 PV of 10% after 4 interest period .683013 1. What is the amortized cost of the debt as of December 31, 2022?
Q: Pharoah Corporation issued $ 4 million of 10-year, 6% callable convertible subordinated debentures…
A: The calculation for Adjustment for interest: Particulars Amount Cash interest (4,000,000 × 6%)…
Q: 1. On November 16, 2020, Bilbond issued its 10-year, 7% P1,000,000 convertible bonds at 122. The…
A: Interest on Bonds: 7% on P 1,000,000 = P 70,000 From the annuity table, we can get the factor for P…
Q: 1. On January 1, 2021, Monic Company decided to issue 5,000, 10 year bonds of 8%, P1,000 face value…
A: Computation explanation for Liability Component:
Q: n January 1, 2019, a company issued 8% convertible 5-year bonds with a face value of P5,000,000 at…
A: Solutions: 1) Conversion Premium = Fair value of Bond - Fair value of Equity Share…
Q: 7. On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a…
A: A convertible debt instrument is a type of financial instrument which has the feature and option of…
Q: On January 1, 20x1, Julius Company issued a three-year, 5,000 convertible bonds at face value of…
A: IFRS 9 "Financial instruments" deals with accounting and measurement of a financial asset or a…
Q: On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face…
A: Annual Interest = Face value of debt instrument x rate of interest x no. of months/12 = P6,000,000…
Q: Mercedes Company issued P 10,000,000 face value 12% convertible bonds at 110 on January 1,2020,…
A: Bonds are the debt security which is issued by the corporates or the governments to collect the…
Q: 19.1 On January 1, 2025, ABC Company issued its 12%. 5-year convertible debt instrument with a face…
A: Convertible Bond: These are the bonds which can be exchanged for common stock of the issuing…
Q: n January 1, 2022, Cai Ltd. issued a 10% convertible bond at par, with a face value of ¥100,000,…
A: Journal entry is the primary reporting of the transactions relating to business in the books of…
Q: Faith Company issued 5500 convertible bonds on January 1, 2019. The bonds have a three-year term and…
A: As Given in the question Faith Company provided 5,000 convertible notes due on January 1, 2019. The…
Q: On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face…
A: Annual Interest = Face value of debt instrument x rate of interest x no. of months/12 = P6,000,000…
Q: The Simon Corporation issued 10-year, $5,000,000 par, 7% callable convertible subordinated…
A: a. Compute basic EPS: Basic EPS = net income / oustanding shares Basic EPS = $9,500,000 / 2,000,000…
Q: On December 31, 2019, Buffalo Wings Co. had outstanding P20 million face value convertible bonds…
A: P20 million face value convertible bonds maturing on December 31, 2022 2,000 of the bonds exercised…
Q: On January 1 , 2021, Gray Co. issued its 10%, 4-year convertible debt instrument with a face amount…
A: Answer - Calculation of balance of the unamortized premium on debt instrument as of Dec. 31, 2021 -…
Q: On January 1, 2019, Lin plc issued a convertible bond with a par value of £50,000 inthe market for…
A: Given :Par value of the Bond - € 50,000Interest rate - 10%Issued price…
Q: On January 1, 20x1, Julius Company issued a three-year, 5,000 convertible bonds at face value of…
A: No of convertible bonds= 5000 Face value of bond= P1000 Interest is paid annually coupon rate= 6%
Q: On January 1, 2016, Trader Company issued its 8%, 4-year convertible debt instrument with a face…
A: Working note: Computation of equity and financial liability component of financial instrument:
Q: On January 1, 2020, ABC Company issued its 10%, 5-year, P3,000,000 convertible bonds for the face…
A: Bond is a debt security which is issued by large organization to raise the fund. Bond is a cheaper…
Q: On January 1, 20x2, Gelato Company issued convertible bonds with a face amount of P5,000,000 for…
A:
Q: The Buffalo Corporation issued 10-year, $4,790,000 par, 7% callable convertible subordinated…
A: Earnings per share (EPS) is determined by dividing a company's profit by the number of outstanding…
Q: On January 1, 2025, Ariana Corporation issued its 8%, 5-year convertible debt instrument with a…
A:
Q: On January 1 , 2021, Gray Co. issued its 10%, 4-year convertible debt instrument with a face amount…
A: Above question is based on Compounded Financial Instrument. In these type of instrument, two…
Q: On January 1, 2020, ABC Corporation issued P5,000,000, 12%, convertible bonds. The privilege allows…
A: The above question relates to split accounting of compound financial instrument into debt and equity…
Q: On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face…
A: Working note: Computation of equity company of compound instrument:
Q: . On December 31, 2019, Tamia Company showed the following balances: Bonds payable – 6%…
A: Bonds are a form of loan or debt that is being issued by the company for raising funds, on which…
Q: V Company issued a 5-year, P5,000,000 face value bonds at 109 on December 31, 2020. Each P5,000 bond…
A: Share Premium = P5,620,000 Calculation: Particulars Amount Amount Cash (5,000,000 / 1,000…
Q: Pharoah Corporation issued $ 4 million of 10-year, 6% callable convertible subordinated debentures…
A: Earning per share (EPS) For the investors and shareholders perspective earning per share (EPS) is…
Q: On January 1, 2020, Raybond issued its 10-year, 7% P1,000,000 convertible bonds at 122. Interest is…
A: Accrued interest = Face value of bonds x rate of interest x no. of months / 12 months where, Rate of…
Q: On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face…
A: Annual Interest = Face value of debt instrument x rate of interest x no. of months/12 = P6,000,000…
Q: 6. On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face…
A: Compound Financial Instruments are those instruments which has both Equity and Liability component.
Q: On January 1, 2021, This Company issues bonds with face amount of P4,000,000 for P4,100,000. The…
A: Working note: Computation of carrying amount of bond as on January 1, 2023: Computation of equity…
Q: On December 31, 2020, Tamia Company showed the following balances: Bonds payable - 6% Discount on…
A: "As per bartleby guidelines we will solve the first multiple choice question for you. If you want…
Q: Chandelier Company issued 4-year P5,000,000 face value of 14% convertible bonds at 106 on January…
A: The corporation for raising funds through debts sometimes follows the method of issuing bonds with…
Q: with a face value of P1,000 per bond (total proceeds received from issuance of the bonds are…
A: Given as, PV of 1 for 4 periods PV of Ordinary Annuity for 4 periods 6% 0.79209…
Q: Windsor Corporation issued 20-year, $10,600,000 face value, 10% convertible debentures on January 1,…
A: Basic Earning Per Share: Investors may find out how much of a company's net income was allocated to…
Q: On July 1, 2020, Berry Company issued 5,000 P1,000 bonds with share warrants at its fair value of…
A: bonds issued with share warrant here at the time of issue of the bonds by the company it will also…
Q: bonds
A: Increase in equity = (Cash received on issue of convertible bonds- Interest payments) - (Cash…
Q: On January 1, 2025, Ariana Corporation issued its 8%, 5-year convertible debt instrument with a face…
A: The correct answer is for the above question is given in the following steps for your reference.
Q: On January 1,2020, ABC Company issued P 10,000,000 convertible bonds with a stated rate of 12% at…
A: Working note: Computation of equity portion of the bond: Computation of carrying amount of bond…
Q: n January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face…
A: solution : This is a compound instrument We need to bifurcate it into financial liability and equity…
Q: Tamarisk Corporation issued 20-year, $10,500,000 face value, 9% convertible debentures on January 1,…
A: The question is based on the concept of Financial Accounting.
Q: On January 1, 2020, Fruits Company issued its 8%, 5-year convertible debt instruments with a face…
A: Bonds are the instrument used in the financial market to borrow the funds from market.
Q: On Dec. 31, 2021, Small Co. issued P 5,000,000 face value, 5-year bonds at 109. Each P 1,000 bond…
A: Compound financial instruments are the instruments with the characteristics of both debt and equity.…
Q: On January 1, 2020, LKI Company converted its 12%, P1,500,000 face value bonds payable with carrying…
A: The gain or loss to be written off on conversion of bonds is the book value of the bonds less the…
Q: Mercedes Company issued P 10,000,000 face value 12% convertible bonds at 110 on January 1,2020,…
A: 1) Let us first convert the bonds into shares -
Q: On January 1, 2016, LoL Corp. issued a 10% convertible bonds with a face value of P4M maturing on…
A: The convertible bond can be converted into equity shares but it is not equity shares until it is…
Q: Libertine Co. issued $10,000,000 of 9%, 10-year, convertible bonds on January 1, 2020. Interest is…
A: No of shares were issued as a result of the conversion: Given, each $1,000 bond is convertible into…
Q: On January 1, 2016, CRAZIER Corp. issued a 10% convertible bonds with a face value of P4M maturing…
A: The convertible bond can be converted into equity shares but it is not equity shares until it is…
Please put all of the necessary data and computations for better understanding. Thanks ?
Step by step
Solved in 2 steps
- On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated interest rate of 12% payable semi-annually on July 1 and January 1. The bonds were sold to yield 10%. Assuming the bonds were sold at 107.732, what is the selling price of the bonds? Were they issued at a discount or a premium?6. On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods PV of 10% after 4 interest period 3. 169865 683013 1. What is the amortized cost of the debt as of December 31, 2022? 2. What is the amount of interest expense for the year ended December 31, 2021? 7. On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face amount of P3,000,000 for P3,500,000. Interest is payable every December 31 of each year. The debt instrument is convertible into 30,000 ordinary shares with a par value of P100. The debt instrument is convertible into equity from the time of…On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865 PV of 10% after 4 interest period .683013 1. What is the amortized cost of the debt as of December 31, 2022? A. 5,619.616 B. 5,701.578 C. 5,791.735 D. 5,890.909
- On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865 PV of 10% after 4 interest period .683013 What is the amount of interest expense for the year ended December 31, 2021? A. P561,962 B. P570,158 C. P579,173 D. P589,0916. On January 1, 2020, Trader Company issued its 8%, 4 year convertible debt instrument with a face amount of P6,000,000 for P5,900,000. Interest is payable every December 31 of each year. The debt instruments is convertible into 50,000 ordinary shares a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 10%. PV of 10% for ordinary annuity of P1 after 4 periods 3.169865PV of 10% after 4 interest period .683013 1. What is the amortized cost of the debt as of December 31, 2022?2. What is the amount of interest expense for the year ended December 31, 2021?On January 1 , 2021, Gray Co. issued its 10%, 4-year convertible debt instrument with a face amount of P 4,000,000 for P 4,400,000. Interest is payable every Dec. 31 of year year. The debt instrument is convertible into 35,000 ordinary shares with a par value of P 100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 8%. PV of 8% for an ordinary annuity of P 1 after 4 years 3.312 PV of 8 % after 4 interest periods. .735 How much of the total proceeds represent the equity component?
- 7. On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face amount of P3,000,000 for P3,500,000. Interest is payable every December 31 of each year. The debt instrument is convertible into 30,000 ordinary shares with a par value of P100. The debt instrument is convertible into equity from the time of issue until maturity. When debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 8%. PV of 8% for an ordinary annuity of P1 after 4 periods 3.3121268PV of 8% after 4 interest periods .7350298 On December 31, 2022, Shredder Company converted all the debt instruments by issuing 30,000 ordinary shares. 1. What is the carrying value of the compound instruments as of December 31, 2022?2. What is the amount of interest expense should the company report in the Dec. 31, 2021 profit or loss?On January 1, 2020, Raybond issued its 10-year, 7% P1,000,000 convertible bonds at 122. Interest is payable annually every December 31, 2020. The bonds would have sold for P1,154,435 without the conversion feature. The effective interest rate of similar bonds without the conversion feature is 5%. What is the accrued interest as of December 31, 2020?On January 1, 2020, Fruits Company issued its 8%, 5-year convertible debt instruments with a face amount of P8,000,000 for P7,700,000. Interest is payable every December 31, of each year. The debt instrument is convertible into 50,000 ordinary shares with a par value of P100. When the debt instruments were issued, the prevailing market rate of interest for similar debt without conversion privilege is 10%. On December 31, 2022, all the convertible debt instruments were retired for P8,000,000. The prevailing rate of interest on a similar debt instruments on December 31, 2022 is 9% without conversion privilege. What is the carrying value of the debt instruments as of December 31, 2022?
- b) Hancock Enterprise Limited (HEL) issued $6,000,000 convertible debentures at January 1, 2019. The debentures have a four-year term, and interest is payable annually in arrears at a nominal annual interest rate of 10% percent. When the debentures were issued, the prevailing market interest rate for similar debt without conversion options was 14 %. The following discount rates are available: PVIFA 10% PVIFA 14% End of year Year 1 Year 2 0.9091 0.8772 0.8264 0.7695 0.6750 Year 3 0.7513 _year 4 0.6830 0.5921 Required: In relation to the convertible debentures disclosed above, prepare extracts of the entity's statement of profit or loss and statement of financial position for the year ended December 31, 2019. (Show all workings.)On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face amount of P3,000,000 for P3,500,000. Interest is payable every December 31 of each year. The debt instrument is convertible into 30,000 ordinary shares with a par value of P100. The debt instrument is convertible into equity from the time of issue until maturity. When debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 8%.PV of 8% for an ordinary annuity of P1 after 4 periods 3.3121268PV of 8% after 4 interest periods .7350298On December 31, 2022, Shredder Company converted all the debt instruments by issuing 30,000 ordinary shares.1. What is the carrying value of the compound instruments as of December 31, 2022?2. What is the amount of interest expense should the company report in the Dec. 31, 2021 profit or loss?On January 1, 2020, Shredder Company Issued its 10%, 4-year convertible debt instrument with a face amount of P3,000,000 for P3,500,000. Interest is payable every December 31 of each year. The debt instrument is convertible into 30,000 ordinary shares with a par value of P100. The debt instrument is convertible into equity from the time of issue until maturity. When debt instruments were issued, the prevailing market rate of interest for similar debt without conversion option is 8%. PV of 8% for an ordinary annuity of P1 after 4 periods 3.3121268 PV of 8% after 4 interest periods .7350298 On December 31, 2022, Shredder Company converted all the debt instruments by issuing 30,000 ordinary shares. 1. What is the carrying value of the compound instruments as of December 31, 2022? A. 3,356,829 B. 3,408,269 C. 3,455,899 D. 3,500,000 2. What is the amount of interest expense should the company report in the Dec. 31, 2021 profit or loss? a. 244,444 b. 248,559 c. 252,370 d. 255,898
