1. On January 1, 2017, Kimberly Co. issued $10,000 face value convertible bonds for $10,600. Immediately, all of the bonds were converted into Kimberly common stock with an aggregate par value of $8,000. After the bond conversion, how should the proceeds from the issuance of the convertible bonds be reflected on the 12/31/2017 balance sheet?

CSTK+APIC RE Debt

1. $ 8,000 $2,000 $ 600
2. 600 -0- 10,000
3. 8,000 2,600 -0-
4. 8,000 -0- 2,600
5. 10,600 -0- -0- <------------------ answer

The answer is e but can someone show me how the full journal entry would look like? I know we would credit Common stock and additional paid-in capital but what would be debit? can someone please provide full journal entry? thanks in advance!