On August $1,2024,$ Perez Communications issued $$30$ million of $11\%$ nonconvertible bonds at $103.$

The bonds are due on July $31,2044.$

Each $$1,000$ bond was issued with $20$ detachable stock warrants, each of which entitled the bondholder to purchase, for $$50,$

one share of Perez Communications' no par common stock.

Interstate Containers purchased $20\%$ of the bond issue.

On August $1,2024,$ the market value of the common stock was $$47$ per share and the market value of each warrant was $$9.$

In February $2035,$ when Perez common stock had a market price of $$61$ per share and the unamortized discount balance was $$2$

million, Interstate Containers exercised the warrants it held.

Required:

Prepare the journal entries on August $1,2024,$ to record $($a$)$ the issuance of the bonds by Perez and $($b$)$ the investment by

Interstate.

Prepare the journal entries for both Perez and Interstate in February $2035,$ to record the exercise of the warrants.

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Complete this question by entering your answers in the tabs below.

Prepare the journal entries on August $1,2024,$ to record $($a$)$ the issuance of the bonds by Perez and $($b$)$ the investment by

Interstate.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your

answers in millions and round to $2$ decimal places $($i$.$e$.,5,500,000$ should be entered as $5\mathrm{.}50).$