FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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On September 1, 2020, Sandhill Corp. sold at 105 (plus accrued interest) 5,190 of its $1,000 face value, 10–year, 10% non–convertible bonds with detachable stock warrants. Each bond carried 2 detachable warrants; each warrant was for one common share at a specified option price of $12 per share. Shortly after issuance, the warrants were selling for $6 each. Assume that no fair value is available for the bonds. Interest is payable on December 1 and June 1. Sandhill Corp. prepares its financial statements in accordance with ASPE.
Prepare in general journal format the entry to record the issuance of the bonds under both options available under ASPE.
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