Bond Conversion

Question

The tramot corporation has $2,000,000 of 6 percent bonds outstanding. There is $40,000 of unamoritized discount remaining on the bonds after the March 1, 2008 semiannual interest payment. The bonds are convertible at the rate of 20 shares of $10 par value common stock for each $1,000 bond. On March 1, 2008, bondholders presented $1,2000,000 of the bonds for conversion. Prepare the entry to record the conversion of the bonds.

Any help you could provide would be soooo greatly appreciated!

Answer 1

Bond Conversion The tramot corporation has $2,000,000 of 6 percent bonds outstanding. There is $40,000 of unamoritized discount remaining on the bonds after the March 1, 2008 semiannual interest payment. The bonds are convertible at the rate of 20 shares of $10 par value common stock for each $1,000 bond. On March 1, 2008, bondholders presented $1,2000,000 of the bonds for conversion. Prepare the entry to record the conversion of the bonds. Any help you could provide would be soooo greatly appreciated!