On June 30, 2024, Blair Industries had outstanding $94 million of 7% convertible bonds that mature on June 30, 2025. Interest is payable each year on June 30 and December 31. The bonds are convertible into 8 million shares of $10 par common stock. On June 30, 2024, the unamortized balance in the discount on bonds payable account was $4 million. On June 30, 2024, half the bonds were converted when Blair's common stock had a market price of $38 per share. When recording the conversion, Blair should credit paid-in capital-excess of par: Multiple Choice $7 million. $9 million. $5 million. $3 million.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On June 30, 2024, Blair Industries had outstanding $94
million of 7% convertible bonds that mature on June
30, 2025. Interest is payable each year on June 30 and
December 31. The bonds are convertible into 8 million
shares of $10 par common stock. On June 30, 2024, the
unamortized balance in the discount on bonds payable
account was $4 million. On June 30, 2024, half the bonds
were converted when Blair's common stock had a market
price of $38 per share. When recording the conversion, Blair
should credit paid-in capital-excess of par:
Multiple Choice
$7 million.
$9 million.
$5 million.
$3 million.
Transcribed Image Text:On June 30, 2024, Blair Industries had outstanding $94 million of 7% convertible bonds that mature on June 30, 2025. Interest is payable each year on June 30 and December 31. The bonds are convertible into 8 million shares of $10 par common stock. On June 30, 2024, the unamortized balance in the discount on bonds payable account was $4 million. On June 30, 2024, half the bonds were converted when Blair's common stock had a market price of $38 per share. When recording the conversion, Blair should credit paid-in capital-excess of par: Multiple Choice $7 million. $9 million. $5 million. $3 million.
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