3) ABC issued 1,000, 5-year, 8% convertible bonds (par $1,000) at 105. Similar straight bonds are trading at 101.

a) $1,010,000 should be debited to cash

b) $1,050,000 should be debited to cash

c) $40,000 should be debited to cash

d) ABC issued two bonds: convertible bonds and straight bonds

4) ABC's current year's PPE depreciation expenses for accounting purpose is $100,000; and CCA for tax purpose is $250,000. The difference between ABC's accounting income and taxable income caused by PPE is:

a) No difference

b) a deductible difference of $150,000

c) a permanent difference of $150,000

d) a taxable difference of $150,000