VaughnCorporation has3400preferred shares that have been issued at $49per share. Each share is convertible into one common share. When the market values of preferred shares are $65and common shares are $70, respectively, the3400shares are converted into common shares. The journal entry to record the conversion of the shares is:

Preferred Shares238000Common Shares238000

Preferred Shares221000Common Shares221000

Preferred Shares54400Common Shares54400

Preferred Shares166600Common Shares166600