Answer:
Option D. Convertible Bonds
Explanation:
The reason is that the convertible bonds are borrowings and hence they are reported in the liability section of the balance sheet. Furthermore, the convertible bonds are reported as liability unless they are converted into equity so until then we will report it as an liability and thereafter, it will be reported as an equity.
The remainder items which include Common Stock and Paid--In Capital are increase in equity because these items increases when we issue stocks whereas the Treasury Stock is decrease in equity because now we repurchase the issued stock hence it is a decrease in equity.
So the only item that doesn't relates to equity section is convertible bonds.
