A Company Issues Convertible Bonds with Face Value of $7,000,000

question 76

Essay

A company issues convertible bonds with face value of $7,000,000 and receives proceeds of $8,500,000.Each $1,000 bond can be converted,at the option of the holder,into 100 common shares.The underwriter estimated the market value of the bonds alone,excluding the conversion rights,to be approximately $7,300,000.
Requirement:
Record the journal entry for the issuance of these bonds based on IFRS.

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