Use the Following Information for Questions 47-49

question 32

Multiple Choice

Use the following information for questions 47-49.
On July 2, 2020, Martineau Ltd. issued $ 6,000,000 (par value) , 9%, ten-year convertible bonds at 98. The bonds were dated April 1, 2020 with interest payable quarterly on July 1, October 1, January 1 and April 1. If the bonds had NOT been convertible, they would have sold for 96.1. The bond discount is amortized on a straight-line basis. On April 1, 2021, $ 1,200,000 of these bonds were converted into 500 no par common shares. Accrued interest was paid in cash at the time of conversion.
-What is the amount of the unamortized bond discount on April 1, 2021 relating to the bonds that were converted?

• A) $ 64,246
• B) $ 46,800
• C) $ 43,200
• D) $ 44,400

---

Definitions:

Cournot Equilibrium

A situation in an oligopoly in which each company chooses its production level assuming the output of its competitors, resulting in a stable market output.

Collusion

An agreement between firms to limit competition, set prices, or divide markets, which usually distorts the outcomes of a free market.

Marginal Revenue

Marginal Revenue is the additional income acquired from selling one more unit of a product or service, crucial for determining optimal production levels.

Cost Function

A mathematical relationship that describes how production costs change with variations in output level.