If sixty $1,000 convertible bonds with a carrying value of $70,000 are converted into 9,000 shares...

If sixty $1,000 convertible bonds with a carrying value of $70,000 are converted into 9,000 shares of $5 par value common stock, the journal entry to record the conversion is

Account Titles and Explanation	Debit	Credit
Bonds Payable (60 x $1000)	60,000
Premium on Bonds Payable (70,000 - 60,000)	10,000
Common Stock (9000 shares x 5)		45,000
Paid-in Capital in Excess of Par (70000 - 45000)		25,000

Please explain where does that bonds payable (60x 1000) comes from?

Expert Solution

ekkarill92 answered 2 years ago

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