(TCO A) On July 1, 2010, an interest payment date, $60,000 of Parks Co. bonds were converted
into 1,200 shares of Parks Co. common stock, each having a par value of $45 and a market value
of $54. There is $2,400 unamortized discount on the bonds. Using the book value method, Parks
no change in paid-in capital in excess of par.
a $3,600 increase in paid-in capital in excess of par.
a $7,200 increase in paid-in capital in excess of par.
a $4,800 increase in paid-in capital in excess of par.
$60,000 – (1,200 X $45) – $2,400 = $3,600. Chapter 16.
(TCO A) On December 1, 2010, Lester Company issued at 103, two hundred of its 9%, $1,000
bonds. Attached to each bond was one detachable stock warrant entitling the holder to purchase
10 shares of Lester's common stock. On December 1, 2010, the market value of the bonds,
without the stock warrants, was 95, and the market value of each stock purchase warrant was