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In 2020, a company issued for $73 per share, 44,000 shares of $60 par value convertible...

In 2020, a company issued for $73 per share, 44,000 shares of $60 par value convertible preferred stock. One share of preferred stock can be converted into four shares of the company’s $49 par value common stock at the option of the preferred stockholder. In August 2021, all of the preferred stock was converted into common stock. The market value of the common stock at the date of the conversion was $30 per share. What total amount should be recorded for Retained Earnings as a result of the conversion of the preferred stock into common stock? If no amount should be recorded for Retained Earnings, then enter 0.

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Answer #1

Answer:$5,412,000

Entry for conversion would be:

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