If Bonds with a Face Value of $150,000 Are Converted

question 96

Multiple Choice

If bonds with a face value of $150,000 are converted into common stock when the carrying value of the bonds is $135,000, the entry to record the conversion will include a debit to

• A) Bonds Payable for $150,000.
• B) Bonds Payable for $135,000.
• C) Discount on Bonds Payable for $15,000.
• D) Bonds Payable equal to the market price of the bonds on the date of conversion.

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