Question
On June 30, 2021, Blair Industries had outstanding $98 million of 7% convertible bonds that mature on June 30, 2022. Interest is payable each year
On June 30, 2021, Blair Industries had outstanding $98 million of 7% convertible bonds that mature on June 30, 2022. Interest is payable each year on June 30 and December 31. The bonds are convertible into 8 million shares of $10 par common stock. At June 30, 2021, the unamortized balance in the discount on bonds payable account was $4 million. On June 30, 2021, half the bonds were converted when Blair's common stock had a market price of $42 per share. When recording the conversion, Blair should credit paid-in capital-excess of par:
A. $5 Million
B. $9 Million
C. $7 Million
D. $11 Million
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