Lakeshore Gelato issues 2,500 shares of $30 par preferred stock with detachable warrants for $215,000 on January 1, 20Y1.  Each share of preferred stock is issued with 10 detachable warrants. Each warrant entitles the holder to purchase one share of common stock for $25. The warrants expire in 2 years. The fair market value of the preferred stock is $145,000 on January 1, 20Y1, and the warrants sell for $3 per warrant.

On July 1, 20Y2, the warrants are exercised to purchase common stock (with a par value of $10 per share). The exercise price is $25 per share.

Record the Lakeshore Gelato Entries (rounded to the penny) for:

(1)         Issuance (round the aggregate value percentage to two decimals is 75.45%)

(2)         Exercise of Warrants