On January 1, 2016, Sandhill Company issued 10-year, $104,000 face value, 6% bonds at par interest payable annually on January 1). Each $1,100 bond is convertible into 30 shares of Sandhill $2 par value common stock. The company has had 11,000 shares of common stock (and no preferred stock) outstanding throughout its life. None of the bonds have been converted as of the end of 2017. Sandhill also has adopted a stock-option plan that granted options to key executives to purchase 6,600 shares of the company's common stock. The options were granted on January 2, 2016, and were exercisable 2 years after the date of grant if the grantee was still an employee of the company (the service period is 2 years). The options expired 6 years from the date of grant. The option price was set at $5, and the fair value option-pricing model determines the total compensation expense to be $26,000. All of the options were exercised during the year 2018: 3,300 on January 3 when the market price was $7, and 1,100 on May 1 when the market price was $8 a share. (Ignore all tax effects.) Prepare the journal entry Sandhill would have made on January 1, 2016, to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit Prepare the journal entry to record interest expense and compensation expense in 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit Date Dec. 31, 2017 (To record interest expense for 2017) (To record compensation expense for 2017) Sandhill's net income in 2017 was $36,300. Compute basic and diluted earnings per share for Sandhill for 2017. Sandhill's average stock price was $6 in 2017. (Round answers to 2 decimal places, e.g. 15.25.) Basic Earnings Per Share Diluted Earnings Per Share $ Assume that 75 percent of the holders of Sandhill's convertible bonds convert their bonds to stock on June 30, 2018, when Sandhill's stock is trading at $8 per share. Sandhill pays $2 per bond to induce bondholders to convert. Preparethe journal entry to record the conversion. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit