Aubrey Inc. issued $4,000,000 of 10%, 10-year convertible bonds on Jan 1, 2014, at 106 plus accrued interest. The bonds were dated Jan 1, 2014, with interest payable JUNE30 and Dec 31. Bond discount is amortized semiannually on a straight-line basis.

On June1, 2015, $1,500,000 of these bonds it converted $1,500,000 of these bonds into 30,000 shares of $20 par value common stock. Accrued interest was paid in cash at the time of conversion.

(a) Prepare the entry to record the interest expense at jun 30, 2014. Assume that accrued interest payable was credited when the bonds were issued.

(b) Prepare the entry to record the conversion on jun 1 , 2015. (Book value method is used.) Assume that the entry to record amortization of the bond discount and interest payment has been made.