On September 1, 2025, Tamarisk Company sold at 104 (plus accrued interest) 4,800 of its 10%, 10-year, $1,000 face value,nonconvertible bonds with detachable stock warrants. Each bond carried two detachable warrants. Each warrant was for one share ofcommon stock at a specified option price of $18 per share. Shortly after issuance, the warrants were quoted on the market for $4 each.No fair value can be determined for the Tamarisk Company bonds. Interest is payable on December 1 and June 1.Prepare in general journal format the entry to record the issuance of the bonds. (List all debit entries before credit entries. Credit accounttitles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titlesand enter O for the amounts.)DateSeptember 1,2025Account Titles and ExplanationCashBonds PayablePremium on Bonds PayableInterest ExpensePaid-in Capital-Stock WarrantsDebit5,086,800MICredit4,800,000128,40038,400120,000

Bonds are debt instruments that pay periodic interest and return the principal at maturity, while…

Prepare in general journal format the entry to record the issuance of the bonds. (List all debit entries before credit entries. 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.) Date September 1, 2025 Account Titles and Explanation Cash Bonds Payable Premium on Bonds Payable Interest Expense Paid-in Capital-Stock Warrants Debit 5,086,800 Credit 4,800,000 128,400 38,400 120,000

Prepare in general journal format the entry to record the issuance of the bonds. (List all debit entries before credit entries. 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.) Date September 1, 2025 Account Titles and Explanation Cash Bonds Payable Premium on Bonds Payable Interest Expense Paid-in Capital-Stock Warrants Debit 5,086,800 Credit 4,800,000 128,400 38,400 120,000

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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