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Crump Inc. issued $1,500,000 of face value convertible bonds on March 31, 2016 for $1,439,000.Starting on March 31, 2021, holders on Crump bonds can convert each $1,000 bond into 30 shares of Crumpâs $5 par value common stock.Crump estimated that, if the bonds were not convertible, the amount received would have been $1,385,000.On June 1, 2021, holders of 375 bonds converted them into common stock when the market value of the common was $42 per share.For questions 1-5, assume Crump uses U.S. GAAP.1. Which of the following statements is correct?A Crump should record a discount on bonds of $115,000 on March 31, 2016.b Crump should not allocate any of the proceeds from the issuance of the convertible bonds to equity.c A and B.d Neither A nor B.2) Which of the following statements is correct?a Crumpâs nonconvertible debt is subordinated to its convertible debt.b Regardless of whether the market value of Trumpâs common stock increases or decreases after March 31, 2016, the market value of the convertible bonds will be based primarily on the current market rate of interest.c A and B.d Neither A nor B.3) Which of the following statements is correct if the unamortized discount on Crumpâs convertible bonds amounted to $33,000 on June 1, 2021?a) Under the book value method, the journal entry to record the conversion should credit âpaid in capitalâ for $305,100.b) Under the market value method, the journal entry to record the conversion should credit âpaid in capitalâ for $416,250.c) A and B.d) Neither A nor B.4.) Using the information provided in the previous question, which of the following statements is correct on June 1, 2021?a) Under both the book and market value methods, the amount debited to âdiscount on bondsâ is $8,250.b) Under the market value method, the âloss from bond conversionâ is $105,750.c) A and B.d) Neither A nor B.5) Which of the following statements is correct if Crump induced the conversion of the 375 bonds on June 1, 2021 by increasing the conversion ratio from 30 common shares per bond to 33 common shares per bond? Assume Crump uses the book value method.a) Debt conversion expense should be charged for $47,250.b) Paid in capital should be credited for $40,265.c) A and B.d) Neither A nor B.6) Which of the following statements is correct, assuming Crump uses IFRS?a) Crump should record an increase in equity of $54,000 on March 31, 2016.b) The amount received from the issuance of the convertible bonds on March 31, 2016 must be bifurcated into debt and equity amounts.c) A and B.d) Neither A nor B.