Reference no: EM132831173

Problem 1: In 20X5, Olynik, Inc. issued (sold) 20,000 no par value convertible preferred shares for $103 each. Each preferred share can be converted into four no par value common shares at the option of the preferred shareholder. At the time of the share sale, similar non-convertible preferred shares were selling for $100 each. In August 20X6, all the preferred shares were converted into common shares. The market value of the common shares at the date of the conversion was $30 per share. What total amount should be credited to Common Shares due to the conversion of the preferred shares into common shares?