6 5 Convertible debt with a separated conversion option after adoption of ASU 2020-06

Convertible bonds have a unique dual nature – they are issued as debt securities but give the bondholder the option to convert into company equity at a preset price. This hybrid characteristic leads to complexity in accounting treatment and financial reporting. A “convertible security” is a financial instrument, usually a bond or preferred stock, that…

What Is Book Value Per Share BVPS?

If quality assets have been depreciated faster than the drop in their true market value, you’ve found a hidden value that may help hold up the stock price in the future. If assets are being depreciated slower than the drop in market value, then the book value will be above the true value, creating a…

Amortization Expense Journal Entry Example, Definition, and Recording

Adjustment entries can also impact a business’s stock-based compensation expenses. Adjustment entries can impact a business’s cash flow by affecting the timing of cash inflows and outflows. For example, if an adjustment entry is made to increase accounts receivable, this will increase the amount of cash that the business expects to receive in the future.…