On January 1, 2023, Graton Limited, a publicly-traded company, issued a convertible debenture with the following terms: The following additional information is available: The straight bond, without a conversion option, would have sold at a market interest rate of 6%. The entire financial instrument sold for gross proceeds of $2,740,000. Graton's effective tax rate is 25%. Jul 1344.414 $2,500,000 face value, 4% interest paid semi-annually on June 30 and December 31. Matures in 10 years. Convertible by the Investor at any time after December 31, 2025 into 75 common shares for every $1,000 of face value. Required: (1) Prepare the journal entry that should have been recorded for January 1, 2023. (2) Prepare the journal entry that should have been recorded for June 30, 2023. (3) Assume that after receiving the interest coupon at December 31, 2029, the investor exercises her conversion option relating to the debenture. What journal entry would be recorded on that date? (4) For purposes of earnings per share, compute the incremental effect of this potentially dilutive security.

On January 1, 2023, Graton Limited, a publicly-traded company, issued a convertible debenture with the following terms: - $2,500,000 face value, 4% interest paid semi-annually on June 30 and Hecember 31. Matures in 10 years. - Convertible by the Investor at any time after December 31, 2025 into 75 common shares for every $1,000 of face value. The following additional information is avallable: - The straight bond, without a conversion option, would have sold at a market interest rate of 6%. - The entire financial instrument sold for gross proceeds of $2,740,000. - Graton's effective tax rate is 25%. Required: (1) Prepare the journal entry that should have been recorded for January 1, 2023. (2) Prepare the journal entry that should have been recorded for June 30, 2023. (3) Assume that after receiving the interest coupon at December 31, 2029, the investor exercises her conversion option relating to the debenture. What journal entry would be recorded on that date? (4) For purposes of earnings per share, compute the incremental effect of this potentiall dilutive security