Converting a loan into shares

Transaction

A corporation owes $60,000.00 on a long-term note payable to a private investor. They agree that the corporation settles the whole note by issuing 4000 shares of common stock with a par value of $5.00 per share to the investor. Record the conversion.

Assumptions: No interest is owed, and the stock issued is worth exactly the carrying amount of the note, so there is no gain or loss on settling it. Costs are ignored.