Answer:
The value of each convertible bond at maturity if ZEN's net assets are: $30 million is $1,500 per convertible bond.
Step-by-step explanation:
First, We need to calculate the Numer so Convertible bonds using following formula
Numbers of Bonds = Total face value of convertible bonds / Face value of on bond
Where
Total face value of convertible bonds = $5,000,000
Face value of on bond = $1,000
Placing values in the formula
Numbers of Bonds = $5,000,000 / $1,000
Numbers of Bonds = 5,000 bonds
Now calculate the total Numbers of convertible shares
Numbers of Convertible shares = Numbers of convertible bonds x Convertible shares against each bond
Numbers of Convertible shares = 5,000 bonds x 200 shares per bond
Numbers of Convertible shares = 1,000,000 shares
Now calculate the total numbers of shares after conversion
Total Numbers of shares after conversion = Existing shares + Convertible shares
Total Numbers of shares after conversion = 3,000,000 shares + 1,000,000 shares
Total Numbers of shares after conversion = 4,000,000 shares
Now calculate the value of each bond if the net asset value is $30 million
Value of Bond = ( Net Asset / Total Numbers of shares after conversion ) x Numbers of convertible shares against each bond
Value of Bond = ( $30,000,000 / 4,000,0000 shares ) x 200 shares per bond
Value of Bond = $1,500 per bond