Which of the following would NOT be included in the journal entry to show the conversion of bonds payable? O A credit to additional paid in capital A debit to bonds payable O A debit to bond premium A credit to gain on conversion

Which of the following would NOT be included in the journal entry to show the conversion of bonds payable? O A credit to additional paid in capital A debit to bonds payable O A debit to bond premium A credit to gain on conversion

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: How would the balance of the discount on bonds payable account usually be reported in the balance…

A: Definition: Bonds payable account: The account which holds the total liability to be paid to the…

Q: n the balance sheet, the account, Premium on Bonds Payable, is: OA. classified as a liability…

A: Bonda means company is borrowing money from the investors by issuing them a legal document that…

Q: The Discount on Bonds Payable account is: Multiple Choice O O O O O An expense. A liability. A…

A: An expense account is not carried forward and closed in the income statement. But Discount on Bonds…

Q: Vaughn Hills Ltd. issued five-year bonds with a face value of $150,000 on January 1. The bonds have…

A: Bonds :— It is one of the type of securities that pays fixed periodic interest and face value amount…

Q: On an income distribution schedule, any gain or loss resulting from intercompany bonds is charged to…

A: Bonds are tradable assets issued by business entities as debt instruments. The holders of the bonds…

Q: Which one of the following is referred as debt finance? O a. Purchase of T-Bills. b. Sale of bonds.…

A: Debt financing is when a company raises money with the use of debt instruments.

Q: For each of the following items, specify whether the information would most likely be found on the…

A: INCOME STATEMENT Income statement Shows the Profitability of the Company. It include all Revenue…

Q: Gains on the redemption of bonds are reported in the Other Revenue section of the income statement.…

A: Introduction: Income statement is considered as one of the key financial statements that shows a…

Q: When a company redeems bonds at a premium to carrying value, that activity is usually classified as:…

A: The company issued the bonds to raise funds in the company so that that funds can be utilized in the…

Q: Would accounting differ if the debt were designated as notes rather than bonds?

A: A bond indenture is a paper certificate or a document which describes specific promises made to the…

Q: If the going concern assumption is not made in accounting, discuss the differences in the amounts…

A: The company prepares its financial report based on generally accepted accounting principles. The…

Q: he method used to pay interest depends on whether the bonds are: Multiple

A: Bonds are financial securities that reflect a type of debt or borrowing between two parties: the…

Q: Bond premium should be reported in the statement of financial position A. along with other premium…

A: A premium on bonds means investors are satisfied with a rate of interest lower than the rate stated…

Q: A debit to Discount on Bonds Payable would most likely be possible on which of the situations?…

A: The bonds are issued at discount when market rate is higher than the coupon rate of interest.

Q: Journalize the above transactions, including the adjusting entry for the accrual of interest on…

A: Journal entry is the first stage of accounting process. Journal entry used to record business…

Q: Interest revenue on bonds is reported as Group of answer choices an addition to the investment in…

A: Interest revenue on bonds is non operating revenue. So it is not operating income.

Q: What is the treatment of transaction costs from issuance to a bond payable measured using the…

A: Transaction costs: Transaction costs also known as issue costs, are those costs that are incurred…

Q: Interest revenue on bonds is reported Question 24 options: as part of other income as part of…

A: The bonds are the financial instruments for the business that are issued to raise money from the…

Q: The balance in Unamortized Premium on Bonds Payable should be O a. reported separately in the…

A: The bond premium is the excess amount that the bond is priced at over its face value. If the amount…

Q: Which of the following is stated correctly? a. Current liabilities follow non-current liabilities…

A: Definition: Liability: Liability is an agreement made by a company to pay a certain amount for the…

Q: Bonds which are collateralized by specific assets in the event the borrowing company defaults on…

A: Bonds are a form of liability for the business. These can be issued for short term or long term.…

Q: Understand the accounting for investments in debt securities

A: Debt securities are the financial instruments which entitle the holder of such securities a fixed…

Q: Which of the following is generally associated with payables classified as A/P? (A) Periodic…

A: Accounts payable means amounts repayable in respect of purchases made from suppliers.

Q: Bonds Payable is a type of current liabilities. True False

A: Bonds payable is a liability for the business, it means amount of bonds that the company has to…

Q: These types of services may be reported as off-balance sheet items except: a. Intangible assets…

A: Off-balance sheet items are assets or liabilities that are not shown on a company's balance sheet…

Q: Describe the accouting for bonds payaable, including bonds issued at face amount , bonds issued at a…

A: A bond payable is a promise to pay series of amount as interest overtime and fixed amount at…

Q: Investments in debt securities are generally recorded at O cost including accrued interest. e…

A: Debt securities are financial instruments that represent a loan made by an investor to an issuer,…

Q: At what amount should trading, available-for-sale, andheld-to-maturity debt securities be reported…

Q: Fair value is used to value which of the following balance sheet accounts? a. Prepaid expenses;…

A: The value of financial instruments, such as debt securities, that are traded or sold is sometimes…

Q: What is the journal entry to record the bond interest payment if you do not have to neither a…

A: The objective of the question is to identify the correct journal entry to record the bond interest…

Q: When bonds are acquired between interest payment dates, the price paid for the bond is: a.…

A: The bonds are considered as long-term liabilities for the organizations and interest accrued are…

Q: Where on the financial statements is an unrealized holding gain or loss on available for sale debt…

A: Available for sale debt investment is the kind of investment which is made with a purpose of sale…

Q: The following data were taken from the balance sheet accounts of Sage Corporation on December 31,…

A: The distribution of the company’s profit to the shareholders is termed as dividends. There are…

Q: unamortized premium

A: Any unamortized premium should be reported on the balance sheet of the issuing corporation as Answer…

Q: Where are debt investments classed as trading securities, available-for-sale securities, and…

A: Secured debt obligations: The borrowed money must be returned and has a specified amount, maturity…

Q: For each case of a financial asset that is not related to one another, explain (must be accompanied…

A: Step 1 Financial assets are the assets which have the following characteristic Contractual…

Q: Which of the following would not be obtained on a listed debt market? Select one: a. Commercial…

A: Commercial Paper: A corporation issues commercial paper to tide over its short-term working capital…

Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

Question

Which of the following would NOT be included in the journal entry to show the conversion of
bonds payable?
O A credit to additional paid in capital
O A debit to bonds payable
O A debit to bond premium
O A credit to gain on conversion

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Define journal entry

VIEW

Step 2: Explain the correct option

VIEW

Step 3: Explain the incorrect options

VIEW

Solution

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The realizable amount of notes receivable is considered. a. Income b. all of the above c. Noncurrent asset d. Current asset
When bonds are redeemed before maturity, how is the gain or loss onredemption determined? Why does the calculation differ for bondsissued at face value, at a premium, and at a discount?
Subject - account Please help me. Thankyou.
Explain details
Which one of the following securities is collateralized (secured) by specific assets? debenture common stock preferred stock mortgage bond
The carrying value of Bonds Payable equalsa. Bonds Payable plus Discount on Bonds Payable.b. Bonds Payable minus Discount on Bonds Payable.c. Bonds Payable minus Premium on Bonds Payable.d. Bonds Payable plus Accrued Interest.
The application of the present value factors in the computation of carrying amounts of bonds payable is a representation of what accounting principle? Conservatism Matching Principle Time Value of Money Materiality
The journal entry a company makes for the issuance of bonds when the contract rate is less than the market rate would be Oa. debit Cash and Discount on Bonds Payable, credit Bonds Payable Ob. debit Cash, credit Bonds Payable Oc. debit Cash, credit Premium on Bonds Payable and Bonds Payable Od. debit Bonds Payable, credit Cash
1. When a company purchases another company's bonds as an investment, an account called investments- XXXX is used. What type of an account and normal balance does this investment account have? a. Asset with a debit balance b. Asset with a credit balance c. liability with a debit balance d. liability with a credit balance 2. What does the word accrued mean when talking about accrued interest? a. The interest has not been earned, but it has been received b. The interest has been earned, but it has not been received c. The interest has not been earned nor received d. The interest is being deferred
What are the two ways that discount and premium on bonds due are amortized? Each one should be explained.
What is the main difference between notes payable and bonds payable?
1. How are the bonds issued, what is the appropriate journal entry? 2. Provide example for issuing bonds.