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ACC - Khan Inc.




Question;On February 1, 20x1, Khan Inc. issued $4,000,000, 10-year, 12% bonds for $4,080,000. Each $1,000 bond had a detachable warrant for the purchase of one share of Khan?s $40 common stock for $62. Immediately after the bonds were issued, Khan?s securities had the following market values:Common stock, $40 par $58Warrant 1012% bond without warrant 1,040On July 15, 20x1, all stock warrants were exercised when the stock price was $75 per share.Required:Prepare the journal entries to record the issuance of bonds with stock warrants and exercise of the stock warrants.


Paper#39501 | Written in 18-Jul-2015

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