The holders of ZZZ Corporation's bonds with a face value of $1,000 can exchange that bond for 35 shares of stock.The stock is selling for $25.00.What is the conversion price?
A)$35.00
B)$7.70
C)$28.57
D)$975

Question

Quizplus · Accepted Answer

The conversion price is the price at which bondholders can convert their bonds into shares of stock. 
To find the conversion price, we need to divide the face value of the bond ($1,000) by the number of shares of stock the bond can be exchanged for (35):
$1,000/35 = $28.57
Therefore, the conversion price is $28.57.

The Holders of ZZZ Corporation's Bonds with a Face Value