On January 1, 2020, Sunland Corporation issued $5 million of 10year, 8% convertible debentures at 108. Investment bankers believe that the debenture would have sold at 104 without the conversion privilege. Interest is to be paid semi-annually on June 30 and December 31. Each $1,000 debenture can be converted into 4 common shares of Sunland after December 31, 2021. On January 1, 2022, $310,000 of debentures are converted into common shares, and on March 31, 2022, an additional $310,000 of debentures are converted into common shares. Fair value of Sunland's common shares is $114 and $119 per share on January 1, 2022, and March 31, 2022, respectively. Accrued interest at March 31 will be paid on the next interest date. Bond premium is amortized on a straight-line basis. Sunland follows ASPE.

(a) Make the necessary journal entries using the book value method. (Hint: March 31, 2022: Accrue interest on bonds to be converted as a first entry.)