(b) Horton, Inc. redeemed $400,000 (face value) of its 11%, 7-year bonds at 96 on July 1, 2017. The bonds were initially issued at 99 on January 1, 2013. Interest is paid on July 1 and January 1. The interest payment on July 1, 2017 has been made and recorded. Fiscal year-end is December 31. (c) Valley Company has $200,000 (face value), 10%, 12-year convertible bonds outstanding. These bonds were issued at face value on January 1, 2011, and pay annual interest on December 31 of each year. The bonds are convertible into 50 shares of Valley $1 par value common stock for each $1,000 face value bond. On December 31, 2017, $150,000 face value of the bonds were converted. The market value of Valleys common stock was $42 per share on December 31, 2017. Instructions For each of the independent situations, prepare the journal entry to record the retirement or conversion of the bonds and any related entry that is required on December 31, 2017.