On April 1, Year 1, Ward Corp. issued $750,000 of 10% nonconvertible bonds at 102...
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On April 1, Year 1, Ward Corp. issued $750,000 of 10% nonconvertible bonds at 102 that are due on March 31, Year 11. Each $1,000 bond was issued with 40 detachable stock warrants, each of which entitled the bondholder to purchase one share of Ward $10 par common stock for $25. On April 1, Year 1, the market value of Ward's common stock was $20 per share, and the market value of each warrant was $4. What amount of the proceeds from the bond issue should Ward record as an increase in stockholders' equity?
A. 15,000
B. 120,000
C. 300,000
D. 750,000
The correct answer is B but I'm not sure how to work the problem to get that answer.
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