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G1 Corp. issued $50 million subordinated convertible debentures on January 1, 2017 at face value. The...

G1 Corp. issued $50 million subordinated convertible debentures on January 1, 2017 at face value. The debentures pay 5% interest annually and are convertible into 50 common shares for each $1,000 of the bond's face value. At maturity, December 31,2018, G1 Corp. has the option of issuing common shares to redeem the bonds instead of paying cash.

REQUIRED:

Prepare all the journal entries associated with the bond for the year ended December 31, 2018.

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Debit $2,500,000 Date Account Titles and Explanation Dec 31, 2018 Interest expense Cash (To record interest expense) Credit 5

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