NEXT CALCULATORM Exercise 16-4 On January 1, 2016, when its $30 per value common stock was selling for $80 per share, Riverbed Corp. issued $10 600,000 of 8% convertible debentures due in 20 years. The conversion option allowed the holder of each $1,000 bond to convert the bond into five shares of the corporation's common stock. The debentures were issued for $11,448,000. Th present value and the amount paid is attributable to the conversion feature. On January 1, 2017, the corporation's S 30 par value common stock was split 2 for 1, and the conversion rate for the bonds was adjusted accordingly. On January 1, 2018, when the corporation's $15 par value common stock was selling for $135 per share, holders of 30% of the convertible debentures exercised their conversion options. The corporation uses the straight-line method for amortizng any bond discounts or premiums e present value of the bond payments at the time of issuance was $9,010,000, and the corporation believes the difference between the (a) Prepare the entry to record the original issuance of the con Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) vertible debentures. (Credit account titles are automatically indented when amount is entered. Account Titles and Explanation Debit Credit (b) Prepare the entry to record the exercise of the conversion option, using the book value method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit