Tiara Puspita Sari - Tugas 4

NAMA Tiara
: Puspita Sari
NIM 202130491
PRODI : AKUNTANSI
AKUNTANSI KEUANGAN MENENGAH II

TUGAS 4 BAB 16
ANSWERS TO QUESTIONS
1. Securities such as convertible debt or stock options are dilutive because their features indicate
that the holders of the securities can become common shareholders. When the common shares
are issued, there will be a reduction-dilution-in earnings per share.
3. Convertible debt and debt issued with stock warrants are similar in that: (1) both allow the issuer
to issue debt at a lower interest cost than would generally be available for straight debt; (2) both
allow the holders to purchase the issuer's stock at less than market value if the stock appreciates
sufficiently in the future; (3) both provide the holder the protection of a debt security if the value of
the stock does not appreciate; and (4) both are complex securities which contain elements of
debt and equity at the time of issue.
18. (a) Basic earnings per share is the amount of earnings for the period available to each
share of common stock outstanding during the reporting period.
(b) Potentially dilutive security is a security which can be exchanged for or converted into
common stock and therefore upon conversion or exercise could dilute (ar decrease)
earnings per share, Included in this category are convertible securities, options, warrants, and
other nights.
(c) Diluted earnings per share is the amount of earnings for the period available to each
share of common stock outstanding and to each share that would have been outstanding
assuming the issuance of common shares for all dilutive potential common shares
outstanding during the reporting period.
(d) Complex capital structure exists whenever a company's capital structure includes
dilutive securities.
(e) Potential common stock is not common stock in form but does enable its holders to
obtain common stock upon exercise or conversion.
SOLUTIONS TO EXERCISES
EXERCISE 16-1
1. Cash ($20,000,000 X.99)......................................... 19,800,000

Discount on Bonds Payable................................... 200,000
Bonds Payable........................................................................ 20,000,000
2. Cash........................................................................ 19,600,000
Discount on Bonds Payable................................... 1,200,000
Bonds Payable............................................................................. 20,000,000
Paid-in Capital-Stock Warrants................................................... 800,000
Value of bonds
plus warrants
($20.000.000 X .98)
Less: Value of warrants
(200.000 X $4)
Value of bonds
3. Debt Conversion Expense...................................... 75,000

Bonds Payable....................................................... 10,000,000
Discount on Bonds Payable............................................. 55,000
Common Stock................................................................ 1,000,000
Paid-in Capital in Excess of Par........................................ 8,945,000
Cash................................................................................. 75,000
*[($10,000,000 - $55,000) - $1,000,000]
EXERCISE 16-6
(a) December 31, 2021

Bond Interest Expense.................................................... 156,000
Premium on Bonds Payable...................................... 4,000
($80,000 X 1/20)
Cash ($4,000,000 X 8% X 6/12)........................................... 160,000
(b) January 1, 2022

Bonds Payable................................................................. 400,000
Premium on Bonds Payable............................................ 6,400
Common Stock.................................................................... 320,000
[8 X $100 X ($400,000/$1,000)]
Paid-in Capital in Excess of Par............................................ 86,400
*Total premium
($4,000,000 X .02) $80.000
Less: Premium amortized
(S80,000 X 2/10) 16,000
Balance $64.000
Bonds converted
($400,000 $4,000,000) 10%
Related premium
($64,000 X 10%) 6,400
(c) March 31, 2022

Bond Interest Expense............................... 7,800
Premium on Bonds Payable....................... 200
($6,400 8 years) X 3/12
Bond Interest Payable.................................... 8,000
($400,000 X 8% X 3/12)
Bonds Payable............................................ 400,000

21 6,200
Common Stock............................................... 320,000
Paid-in Capital in Excess of Par...................... 86,200
*Premium as of January 1, 2022

for $400,000 of bonds $6,400
$6,400 8 years remaining
X 3/12 -200
Premium as of March 31, 2022
for $400,000 of bonds $6.200
(d) June 30, 2022

Bond Interest Expense............................... 124,800
Premium on Bonds Payable....................... 3,200
Bond Interest Payable................................ 8,000
($400,000 X 8% X 1/4)***
Cash........................................................... 136,000
[Premium to be amortized:
($80,000 X 80% ) X 1/20 = $3,200, or
$51,200** 16 (remaining interest and
amortization periods) = $3,200]
*Total to be paid: ($3,200,000 X 8% + 2) + $8,000 = $136,000
**Original premium $80.000

2020 amortization -8,000
2021 amortization -8,000
Jan. 1, 2022 write-off -6,400
Mar. 31, 2022 amortization -200
Mar. 31, 2022 write-off -6,200
$51.200
***Assumes interest accrued on March 31. If not, debit Bond Interest

Expense for $132,800.
EXERCISE 16-15
(a) 2,200,000 shares

Jan. 1, 2016-Sept. 30, 2016 (2,000,000 X 9/12) 1,500,000
Retroactive adjustment for stock dividend X 1.10
Jan. 1, 2016-Sept. 30, 2016, as adjusted 1,650,000
Oct. 1, 2016–Dec. 31, 2016 (2,200,000 X 3/12) 550,000
2,200,000
Another way to view this transaction is that the 2,000,000 shares at the
beginning of the year must be restated for the stock dividend
regardless of where in the year the stock dividend occurs.
(b) 3,700,000 shares 550,000
Jan. 1, 2017-Mar. 31, 2017 (2,200,000 X 3/12) 3,150,000
Apr. 1, 2017–Dec. 31, 2017 (4,200,000 X 9/12) 3,700,000
(c) 7,400,000 shares

2017 weighted-average number of shares
previously computed 3,700,000
Retroactive adjustment for stock split X 2
7,400,000
(d) 8,400,000 shares

Jan. 1, 2018-Mar. 31, 2018 (4,200,000 X 3/12) 1,050,000
Retroactive adjustment for stock split X 2
Jan. 1, 2018-Mar. 31, 2018, as adjusted 2,100,000
Apr. 1, 2018-Dec. 31, 2018 (8,400,000 X 9/12) 6,300,000
8,400,000
Another way to view this transaction is that the 4,200,000 shares at the
beginning of the year must be restated for the stock split regardless of
where in the year the stock split occurs.
f the value of

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NAMA Tiara

AKUNTANSI KEUANGAN MENENGAH II

1. Cash ($20,000,000 X.99)......................................... 19,800,000

3. Debt Conversion Expense...................................... 75,000

*[($10,000,000 - $55,000) - $1,000,000]

(a) December 31, 2021

(b) January 1, 2022

(c) March 31, 2022

Bonds Payable............................................ 400,000

*Premium as of January 1, 2022

(d) June 30, 2022

*Total to be paid: ($3,200,000 X 8% + 2) + $8,000 = $136,000

**Original premium $80.000

***Assumes interest accrued on March 31. If not, debit Bond Interest

(a) 2,200,000 shares

(c) 7,400,000 shares

(d) 8,400,000 shares

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