Liberty Inc. prepares its financial statements in accordance with IFRS. On January 1, 2023, the company issued $30.0 million, 7%, six-year convertible bonds that pay interest semi-annually on June 30 and December 31. At the option of the bondholder, and at any time before maturity, each $1,000 bond was convertible into 40 of Liberty Inc.'s common shares. Liberty raised $30.6 million from the sale of the bonds. At the time of sale, the market rate of interest for similar bonds without the conversion feature was 8.0%. On January 1, 2025, $12.0 million of the bonds were converted. The market price of Liberty Inc.s common shares at the time of conversion was $35 per share.

Required: Prepare the journal entry to record the issuance of the convertible bonds.

Prepare the journal entry to record the conversion of the bonds.