3.

Keho Company has $80,000, 8%, 12year convertible bonds outstanding. These bonds

were sold at face value and pay semiannual interest on June 30 and December 31 of each

year. The bonds are convertible into 30 shares of Keho $5 par value common stock for

each $1,000 worth of bonds. On December 31, 201

8

, after the bond interest has been

paid, $40,000 face value bonds were converted. The market price of Keho common stock

was $44 per share on December 31, 201

8

.