On January $1,2023,$ when the fair value of its common shares was $$70$ per share, Cullumber Corp. issued $$9$ million of $8\%$ convertible debentures due in $20$ years. The conversion option allowed the holder of each $$1,000$ bond to convert the bond into $5$ common shares. The debentures were issued for $$9\mathrm{.}8$ million. The bond payment's present value at the time of issuance was $$7\mathrm{.}7$ million and the corporation believes the difference between the present value and the amount paid is attributable to the conversion feature. On January $1,2024,$ the corporation's common shares were split $3$ for $1,$ and the conversion rate for the bonds was adjusted accordingly. On January $1,2025,$ when the fair value of the corporation's common shares was $$133$ per share, holders of $28\%$ of the convertible debentures exercised their conversion option. Cullumber applies ASPE and uses the straight$-$line method for amortizing any bond discounts or premiums.

$($a$)$

Your answer is correct.

Prepare the entry to record the original issuance of the convertible debentures. $($Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts. List all debit entries before credit entries.$)$

$($b$)$

Using the book value method, prepare the entry to record the exercise of the conversion option.