1-1. On 1/1/19, Everwood Co. issues 10,000 shares of 10 par value convertible preference shares for 12 cash per share. Each share is convertible into 4 ordinary shares. On this date the 1 par value ordinary shares are selling for 3 per share. Approximately 2 years later, Everwoods shareholders convert their preference shares into ordinary shares. On the date of conversion the preference shares are selling for 16 and the ordinary shares are selling for 5 per share. The journal entry on 1/1/19 will include which of the following?

a. Credit Share CapitalPreference 20,000.

b. Credit Share PremiumOrdinary 20,000.

c. Credit Share CapitalPreference 100,000.

d. Debit Share PremiumOrdinary 20,000.

1-2. Everwood Co. issues 10,000 shares of 10 par value convertible preference shares for 12 cash per share. Each share is convertible into 4 ordinary shares. On this date the 1 par value ordinary shares are selling for 3 per share. Approximately 2 years later, Everwoods shareholders convert their preference shares into ordinary shares. On the date of conversion the preference shares are selling for 16 and the ordinary shares are selling for 5 per share. The journal entry on the date of conversion will include which of the following?

a. Credit Share CapitalPreference 20,000.

b. Credit Share PremiumOrdinary 80,000.

c. Credit Share CapitalOrdinary 100,000.

d. Credit Share PremiumOrdinary 160,000.