A firm has an outstanding bond with a $1,000 par value that is convertible into 50 shares of common stock. The bond's conversion price per share is ______________.

Question

Quizplus · Accepted Answer

The conversion price per share is calculated by dividing the bond's par value ($1,000) by the number of shares it can be converted into (50). Therefore, the conversion price per share is $20.

A Firm Has an Outstanding Bond with a $1,000 Par