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Wolf Company issued 1,000 of its $1,000 face amount, 20-year bonds on June 30, 2010, for $1,020,000. Each bond carries five detachable stock purchase warrants, each of which entitles the holder to purchase for $60 one share of Wolf's common stock. On June 30, 2010, the market prices were $50 per share of Wolf's common stock and $5 per warrant. In its June 30, 2010, balance sheet, at what amount should Wolf report the carrying amount of the bonds?

a. $995,000

b. $1,000,000

c. $1,020,000

d. $1,045,000

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M950343

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