If Bonds with a Face Value of $140000 Are Converted

question 84

Multiple Choice

If bonds with a face value of $140000 are converted into common stock when the carrying value of the bonds is $135000 the entry to record the conversion will include a debit to

• A) Bonds Payable for $140000.
• B) Bonds Payable for $135000.
• C) Discount on Bonds Payable for $5000.
• D) Bonds Payable equal to the market price of the bonds on the date of conversion.

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Definitions:

Kaoru Ishikawa

A prominent Japanese organizational theorist known for his contributions to quality management, including the development of the Ishikawa or fishbone diagram.

Fishbone Diagram

A visual tool used for identifying the root causes of a problem, named for its resemblance to a fish's skeleton.

Problem-Solving Tool

A method, technique, or device that assists in identifying solutions to specific issues or challenges.

Productivity Growth

The increase in the efficiency of production of goods and services, measured by the output per unit of input over time.