On 1/1/20, Sargento issued $5.5 million of 6%, 10-year convertible bonds at 103. The bonds pay interest on June 30 and December 31. Each $1,000 bond is convertible into 30 shares of $1 par common stock. Kohler Company purchased 30% of the issue as an investment. On July 1, 2024, Kohler converted all of its bonds into common stock of Sargento. The market price per share for Sargento was $27 at the time of the conversion. Both companies use the straight-line method for amortization. Required:1. Prepare journal entries for the issuance of the bonds on the issuer.2. Prepare the journal entries for the conversion on the books of the issuer.