Stannis Inc has $300,000 (book value) of convertible bonds outstanding, with no conversion fee. The conversion ratio

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Stannis Inc has $300,000 (book value) of convertible bonds outstanding, with no conversion fee. The conversion ratio is 50 shares per $1000 of bonds.

Transaction: A bondholder converts $10,000 of bonds into 500 shares of common stock. The common stock has par value of $1, and market price of $45.

How are the following affected by the transaction? (+, -, or O)

Cash

Non-Cash Assets

Liabilities

Contributed Capital

Retained Earnings

Revenue

Expenses

Related Book For answer-question

Principles of Corporate Finance

ISBN: 978-0072869460

7th edition

Authors: Richard A. Brealey, Stewart C. Myers

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Posted Date: May 30, 2022 05:21 AM

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Stannis Inc has $300,000 (book value) of convertible bonds outstanding, with no conversion fee. The conversion ratio

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Cash Non cash assets Liabilities Contributed capital Retained earnings Revenue Expenses Explanation ... View the full answer

Principles of Corporate Finance

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