Marshall Corporation has $37,000 of bonds outstanding with a carrying value of $45,400. The bonds are converted into 18,500 shares of $1 par value common stock immediately after the last interest payment. The common stock had a market value of $5 per share on the date of conversion. The entry to record the conversion would include a credit to:
A)Common Stock for $18,500 and credit to Paid-in Capital in Excess of Par for $8400.
B)Bonds Payable for $37,000 and credit to Premium on Bonds Payable for $8400.
C)Cash for $45,400.
D)Common Stock for $18,500 and credit to Paid-in Capital in Excess of Par for $26,900.

Question

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The Answer of Marshall Corporation has $37,000 of bonds outstanding with a carrying value of $45,400. The bonds are converted into 18,500 shares of $1 par value common stock immediately after the last interest payment. The common stock had a market value of $5 per share on the date of conversion. The entry to record the conversion would include a credit to:
A)Common Stock for $18,500 and credit to Paid-in Capital in Excess of Par for $8400.
B)Bonds Payable for $37,000 and credit to Premium on Bonds Payable for $8400.
C)Cash for $45,400.
D)Common Stock for $18,500 and credit to Paid-in Capital in Excess of Par for $26,900.

Marshall Corporation Has $37,000 of Bonds Outstanding with a Carrying