Exercise 16-6 On January 1, 2017, Riverbed Corporation issued $4,140,000 of 10-year, 8% convertible debentures at...

Exercise 16-6

On January 1, 2017, Riverbed Corporation issued $4,140,000 of 10-year, 8% convertible debentures at 104. Interest is to be paid semiannually on June 30 and December 31. Each $1,000 debenture can be converted into 8 shares of Riverbed Corporation $100 par value common stock after December 31, 2018.

On January 1, 2019, $414,000 of debentures are converted into common stock, which is then selling at $111. An additional $414,000 of debentures are converted on March 31, 2019. The market price of the common stock is then $116. Accrued interest at March 31 will be paid on the next interest date.

Bond premium is amortized on a straight-line basis.

Make the necessary journal entries for:

(a)		December 31, 2018.		(c)		March 31, 2019.
(b)		January 1, 2019.		(d)		June 30, 2019.

Expert Solution

ekkarill92 answered 1 year ago

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