Question

Riverbed Corporation issued 1,900 shares of $10 par value common stock upon conversion of 950 shares of $50 par value preferred stock. The preferred stock was originally issued at $64 per share. The common stock is trading at $26 per share at the time of conversion.Record the conversion of the preferred stock.

Answer 1

The answer is given below;

Step-by-step explanation:

Preference stocks 950*50 Dr.$47,500

Paid in capital in excess of par-preference shares Dr.$ 13,300

(64-50)*950

Common Stocks 1,900*10 Cr.$19,000

Paid in capital in excess of par-common stocks Cr.$41,800

(64*950)-(1900*10)