Assume that the preferred are convertible into common at a rate of eight common shares for each share of preferred. If 1,000 shares of the preferred are converted into common on November 1, 2020, prepare the entry and describe how this affects the equity section of the balance sheet (immediately after the conversion).

                                                         Swift Current Company
                                             Equity Section of the Balance Sheet
                                                         October 31, 2020
Contributed capital:
Preferred shares, $17 cumulative, 3,500 shares authorized,
issued, and outstanding......................................................... $1,190,000
Common shares, unlimited shares authorized,
50,000 shares issued and outstanding ................................. 1,200,000
Total contributed capital ....................................................... $2,390,000
Retained earnings ....................................................................... 472,000
Total equity ............................................................................. $2,862,000