On July 1, 2019, Madrid Plastics Issued Bonds That Included

On July 1, 2019, Madrid Plastics issued bonds that included 20 detachable stock warrants for each bond. The warrants were appropriately valued at $4 each at the time the bonds were issued. Each warrant allows the warrant holder to purchase a share of $5 par common stock for $33 per share. A holder of 662 warrants decided to exercise all warrants and purchased 662 shares of stock when the market price of the shares was $42. What is the proper journal entry for Madrid to record this transaction?

A) $$\begin{array} { | c | l | r | r | } \hline \text { Date } & { \text { Account } } & { \text { Debit } } & \text { Credit } \\\hline \text { July 1,2019 } & \text { Cash } & 21,846 & \\& \text { Additional Paid-in Capital - Stock } \\& \text { Warrants } & 2,648 & \\\hline & \text { Common Stock } & & 3,310 \\\hline & \begin{array} { l } \text { Additional Paid-in Capital } \\\text { in Excess of Par-Common }\end{array} & & 21,184 \\\hline\end{array}$$
B) $$\begin{array} { | c | c | c | c | } \hline \text { Date } &{ \text { Account } } & \text { Debit } & \text { Credit } \\\hline \text { July 1,2019 } & \text { Cash } & 21,846 & \\\hline & \text { Common Stock } & & 3,310 \\\hline& \text { Paid-in-Capital-Common } \\&\text { Stock }& & 18,536\\\hline\end{array}$$
C) $$\begin{array} { | c | l | r | r | } \hline \text { Date } &{ \text { Account } } & \text { Debit } & { \text { Credit } } \\\hline \text { July 1,2019 } & \text { Cash } & 21,846 & \\\hline & \text { Paid-in Capital-Stock Warrants } & 2,648 & \\\hline & \text { Common Stock } & & 21,846 \\\hline & \begin{array} { l } \text { Paid-in-Capital-Common } \\\text { Stock }\end{array} & & 2,648 \\\hline\end{array}$$
D) $$\begin{array} { | c | l | r | r | } \hline \text { Date } & { \text { Account } } & \text { Debit } & \text { Credit } \\\hline \text { July 1,2019 } & \text { Cash } & 21,846 & \\\hline & \text { Paid-in Capital - Stock Warrants } & 2,648 & \\\hline & \text { Common Stock } & & 24,494 \\\hline\end{array}$$