On July 1, 2018, Consolidated Limited issued $3,200,000 of convertible bonds. The bonds pay annual interest of 8% on June 30. Each $1,000 bond is convertible into 110 common shares, at the investor's option, between July 1, 2023, and July 1, 2028, at which time the bonds mature. The financial instrument was issued for total proceeds of $3,671,046, yielding 6%. The bonds without the conversion feature were valued at $2,806,748, yielding 10%. Consolidated also has a stock option plan. On October 1, 2018, the company issued 15,000 options to employees to buy common shares at $24 per share. An option pricing model valued these options at $300,000. The vesting period is five years. On December 31, 2018, $4,000 worth of options that had been granted in previous years expired unexercised. Consolidated has a December 31 year-end.

a. Prepare the journal entry to record the issuance of the bonds on July 1, 2018

b. Prepare the journal entries to record the issuance and expiration of stock options.

Begin by preparing the entry related to the issuance of stock options during the year

Next prepare the entry required to record the expiration of stock options that had been granted in previous years