When bonds are converted into shares,shareholders' equity is increased by the face value of the bonds.

Name: When bonds are converted into shares,shareholders' equity is increased by the face value of the bonds.
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When bonds are converted into shares, the shareholders' equity is increased by the market value of the bonds, not the face value. This is because the market value reflects the true value of the bonds at the time of conversion, rather than just the initial amount borrowed.

When Bonds Are Converted into Shares,shareholders' Equity Is Increased by the Face