Link Back to Chapter 4 (Debt Ratio). Blade Automotive Corp. has $1.000.000 of convertible bonds payable outstanding, with a bond premium of $60,000 also on the books. The bondholders have notified Blade that they wish to convert the bonds into stock. Specifically, the bonds may be converted into 200.000 shares of Blade's $1 par common stock. 1. What is Blade's carrying amount of its convertible bonds payable prior to the conversion? 2. Journalize, on Blade's books, the conversion of the bonds payable into common stock. No explanation is required. 3. How will the conversion affect Blade's debt ratio?