On first examination of this question I thought that the 1,500,000 is the part that would be included in 2007 current liabilities as its intended to be retired next year during 2008.
Why is it excluded from CL?
The question also implies they are retiring the entire 1,750,000 of debt from the new stock in the next year. So I could see why 1,750,000 might be viewed as the right answer, because how is the company supposed to know they’ll be selling it for $15/share 3 months from now?