Homework Help: Intermediate Accounting

Posted by cyndi on Saturday, December 11, 2010 at 2:44am.

During 2009 Bradley Corporation issued for $110 per share, 5,000 share of $100 par value convertible preferred stock. One share of preferred stock can be converted into three shares of Bradley’s $25 par value common stock at the option of the preferred stockholder. On December 31, 2010, all of the preferred stock was converted into common stock. The market value of the common stock at the conversion date was $40 per share. What amount should be credited to the common stock account on December 31, 2010?
a. $375,000
b. $500,000
c. $550,000
d. $600,000

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