I found this answer to this, but I really would love a more detailed answer form

Question

I found this answer to this, but I really would love a more detailed answer formulta. I can't figure out how to calculate the bonds payable and the discounts. The answer I found has the journal entries with no info how to do the formulas.

At the start of the year, Triple T Company issued $6 million of 7% notes along with warrants to buy 400,000 shares of its $10 par value common stock at $18 per share. The notes mature over the next 10 years, starting one year from date of issuance, with annual maturities of $600,000. At the time, Triple T had 3,200,000 shares of common stock outstanding, and the market price was $23 per share. The company received $6,680,000 for the notes and the warrants. For Triple T, 7% was a relatively low borrowing rate. If offered alone, at this time, the notes would have been issued at a 20 to 24% discount. Prepare journal entries for the issuance of the notes and warrants for the cash consideration received. Notes would have been issued at a 20% to 24% discount.

Explanation / Answer

Notes of $ 600000, issued at 6680000/10 = 668000

Warrant value = Warrant on 600000 Notes*(Market Value - price of right to purchase)

Warrant value = 400000/10*(23-18)

Warrant value = 200000

Bond Value without warrant = 668000-200000 = 448000

Discount = (600000-468000)/600000

Discount = 22%

Answer

Bonds Payable = 6,000,000

Discount = 22%* 6 Million = 1320000

Warrant value = 400000*5 = 2000000

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