Simpson Ltd issued $10 million of convertible notes on 1 July 2023. The notes have a life of 3 years and a face value of $10 each. Annual interest of 4% is payable at the end of each year. The notes were issued at their face value and each note can be converted into one ordinary share in Simpson Ltd at any time over their lives. Organisations with a similar risk profile to Simpson Ltd have issued debt with similar terms but without the option to convert at the rate of 6% per annum.

Required:

Provide the appropriate accounting entries to record i) the issue of the convertible notes; ii) the payment of interest on 30th June 2024; iii) the conversion of convertible notes into shares on 1 July 2024