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Ten, $100 bonds with a carrying value of $1,280 are converted into 100 shares of $10...

Ten, $100 bonds with a carrying value of $1,280 are converted into 100 shares of $10 par value common stock. Currently, the common stock has a market value of $7 per share. What is the correct credit part of the journal entry for the conversion?

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Expert Solution

Bonds payable (10*100) 1000
Premium on Bonds Payable (1280-1000) 280
Common stock (100*10) 1000
Paid in capital in excess of par 280

ekkarill92 answered 2 years ago
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