Prepare the Journal Entries Necessary to Record the Following Transactions

question 115

Essay

Prepare the journal entries necessary to record the following transactions for the Falcon Company:
a. On January 1, Year 1, the company issued 10,000 shares of common stock (par value $5) at $15 per share.
b. On January 1, Year 2, the company issued $200,000 of convertible bonds at par. The bonds have a face value of $1,000, pay 8% annually and are convertible into 40 shares of common shares. Without the conversion feature, the bonds would have been issued at 98.
c. On June 1, Year 2, the company repurchased 8,000 of the common shares when the market price per share was $25.
d. On January 1, Year 3, the convertible bonds were exchanged for treasury shares. The market price of common stock on that date is $30. (Hint: recognize a gain or loss on conversion.)

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Definitions:

Sociological Research

Sociological research is the systematic study of social phenomena, employing various methodologies to collect and analyze data to understand and explain aspects of social behaviors and patterns.

Research Design

The framework or strategy employed in a study to investigate research questions or hypotheses, guiding the selection of methods and techniques for data collection and analysis.

Qualitative Researcher

A professional who conducts research using non-numerical methods to explore phenomena and gain understanding of social, psychological, or educational aspects.

Interviews

Person-to-person conversations for the purpose of gathering information by means of questions posed to respondents.