home / study / business / accounting / accounting questions andanswers / the cfo of the tapco plastics industries corporation hasrequested your help in preparing several ... Question: The CFO ofThe Tapco Plastics Industries Corporation has requested your helpin preparing several... (3 bookmarks) The CFO of The Tapco PlasticsIndustries Corporation has requested your help in preparing severaljournal entries. She has sent you the following information.October 1, 2013: issued $6,000,000 of “20” year convertible bonds.The bonds pay an annual rate of interest of 5%, payablesemi-annually on April 1 st and October 1 st each year. The bondswere issued with a premium of $180,000. The premium is beingamortized on a straight line basis. The bonds can be converted onany date after 4 years from their issue date, into 10 shares ofTapco’s $5 par value common stock for each $1,000 of bonds. OnDecember 1, 2017 $1,200,000 of bonds were turned in for conversion.Accrued interest on the bonds being converted was also paid to theholders at the time of the conversion. The company’s stock wasselling for $205 per share on the date of the conversion. On May1,2018 $480,000 of bonds were turned in for conversion. Accruedinterest on the bonds being converted was also paid to the holdersat the time of the conversion. The company’s stock was selling for$235 per share on the date of the conversion. Note: Tapco PlasticsCorporation has a year end of December 31 st . Prepare all journalentries pertaining to these bonds for the dates below: October 1,2017 December 1, 2017 May 1, 2018 December 31, 2018 April 1,2019
