On January 1, 2017, Sydney Inc. issued P 5,000,000 face value, 5-year bonds at 109. Each P1,000 bond was issued with one detachable share warrant, each of which entitled the bondholder to purchase 15 shares of P10 par ordinary share at P20. At issuance date, the market value of each of the bonds without warrant sell at 99. The stated rate on the bonds is 11% payable annually every January 1, starting January 1, 2018. How much from the proceeds is assigned to the equity on the date of issuance? 450,000 4,950,000 500,000 O 50,000

On January 1, 2017, Sydney Inc. issued P 5,000,000 face value, 5-year bonds at 109. Each P1,000 bond was issued with one detachable share warrant, each of which entitled the bondholder to purchase 15 shares of P10 par ordinary share at P20. At issuance date, the market value of each of the bonds without warrant sell at 99. The stated rate on the bonds is 11% payable annually every January 1, starting January 1, 2018. How much from the proceeds is assigned to the equity on the date of issuance? 450,000 4,950,000 500,000 O 50,000

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter20: Hybrid Financing: Preferred Stock, Warrants, And Convertibles

Section: Chapter Questions

Problem 1P: Neubert Enterprises recently issued $1,000 par value 15-year bonds with a 5% coupon paid annually...

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