Telta Inc. issued $ of year convertible bonds on November at plus accrued interest. The bonds were
dated July with interest payable January and July Bond discount premium is amortized semiannually on a straightline
basis.
On July onehalf of these bonds were converted into shares of $ par value common stock. Accrued interest was paid
in cash at the time of conversion.
a Prepare the entry to record the interest expense at December Assume that accrued interest payable was credited
when the bonds were issued. Credit Interest Payable for the full amount due; debit Interest Payable for the amount
recognized at insurance. Round to nearest dollar.
b Prepare the entry to record the conversion on July Book value method is used. Assume that the entry to record
amortization of the bond discount and interest payment has been made.
