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On January 1, $343,200 of par value bonds with a carrying value of $364,000 is converted to 57,200 shares of $5 par value common stock. The entry to record the conversion of the bonds includes all of the following entries except:A. Debit to Premium on Bonds Payable $20,800.B. Credit to Common Stock $286,000.D. Credit to Paid-In Capital in Excess of Par Value, Common Stock $78,000.E. Debit to Bonds Payable $343,200.
F. Debit to Bonds Payable $364,000.

Respuesta :

Answer:

F. Debit to Bonds Payable $364,000.

Explanation:

The journal entries are shown below:

1. Cash A/c Dr  $364,000

             To Bonds payable A/c $343,200

             To Premium on Bonds payable A/c $20,800

(Being bond is issued)

2. Bonds payable A/c $343,200

   Premium on Bonds payable A/c $20,800

                 To Common Stock $286,000

                 To Paid-In Capital in Excess of Par Value, Common Stock $78,000

(Being conversion of bonds is recorded)

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