On September 30, 2020, Sunland Inc. issued $3,750,000 of 10-year, 8% convertible bonds for $4,306,000. The bonds pay interest on March 31 and September 30 and mature on September 30, 2030. Each $1,000 bond can be converted into 80 no par value common shares. In addition, each bond included 20 detachable warrants. Each warrant can be used to purchase one common share at an exercise price of $15. Immediately after the bond issuance, the warrants traded at $2.90 each. Without the warrants and the conversion rights, the bonds would have been expected to sell for $3,947,000. On March 23, 2023, half of the warrants were exercised. The common shares of Sunland Inc. were trading at $20 each on this day. Immediately after the payment of interest on the bonds, on September 30, 2025, all bonds outstanding were converted into common shares. Assume the entity follows IFRS.

Prepare the journal entry to record the issuance of the bonds on September 30, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
September 30, 2020

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Using (1) a financial calculator or (2) Excel functions, calculate the effective rate (yield rate) for the bonds. (Round answer to 4 decimal places, e.g. 5.2500%.)

Semi-annual effective rate

Enter your answer in accordance to the question statement %

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Prepare a bond amortization schedule from September 30, 2020, to September 30, 2025, using the effective interest rate. (Round answers to 0 decimal places, e.g. 5,275.)

Schedule of Bond Premium Amortization
Effective Interest Method
			Cash		Effective		Premium		Carrying
Date			Paid		Interest		Amortized		Amount
Sept. 30,	2020								$
Mar. 31,	2021		$		$		$
Sept. 30,	2021
Mar. 31,	2022
Sept. 30,	2022
Mar. 31,	2023
Sept. 30,	2023
Mar. 31,	2024
Sept. 30,	2024
Mar. 31,	2025
Sept. 30,	2025

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Prepare the December 31, 2020 year-end adjusting journal entries and the payment of interest on March 31, 2021. Assume that Sunland Inc. does not use reversing entries. For amortization of premium, pro-rate using number of months. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
December 31, 2020
March 31, 2021

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Prepare the journal entry to account for the exercise of the warrants on March 23, 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
March 23, 2023

How many common shares were issued in this transaction?

Common shares issued

shares

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Prepare the journal entry to account for the bond redemption on September 30, 2025. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
September 30, 2025

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How many shares were issued on September 30, 2025?

Shares issued

shares

Calculate the minimum market value of the common shares as of the date of the conversion, September 30, 2025. (Round answer to 2 decimal places, e.g. 52.75.)

Minimum market value

$

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