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On July 1, 2017, Roberts Corporation issued 3,000,000of930 one share of 1parvaluecommonstockatanytimeduringthenext10years.Thebondsweresoldfor3,000,000. The value of the warrants at the time of issuance was $100,000. Prepare the journal entry to record this transaction.

Short Answer

Expert verified

Cash account and discount on bonds payable will be debited with $3,000,000 and $100,000 respectively. Bonds payable and Paid-In capital- Stock warrants account will be credited with $3,000,000 and $100,000 respectively.

Step by step solution

01

The details provided in the question are as follows

We have

Bond Payable $3,000,000

Stock Warrants $100,000

02

Representing given data in journals for of accounting

Date

Particulars

Debit

Credit

Cash

3,000,000

Discount on Bonds Payable

100,000

Bonds Payable

3,000,000

Paid-in Capitalโ€”Stock Warrants

100,000

Being sale of bond is recorded

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