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When a Bond Issue Is Converted into Common Stock,total Contributed

question 98

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When a bond issue is converted into common stock,total contributed capital is increased by the fair market value of the bonds converted.


Definitions:

Interest Rate

The percentage at which interest is charged or paid on a loan or investment over a specified period.

Accrued Interest

Interest that has accumulated over a period of time but has not yet been paid.

Premium

An amount paid for an insurance policy, or the price above the normal or nominal cost in financial transactions.

Discount

A reduction from the usual cost of something, often expressed as a percentage off the original price.

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