1. $700,000 of bonds with detachable stock warrants were issued for $711,000. Each $1000 bond carried seven warrants which allowed for the purchase of 7 shares of common stock for $38 each. Shortly after the time of issuance, the bonds without the warrants were selling at 99; the warrants were selling at $5 each. For the journal entry for the issuance of the bonds with the detachable stock warrants, how much is recorded for the stock warrants?

1. $24,500
2. $150,578
3. $24,278
4. zero