The Secret Sauce Technology Company Limited has accepted funding to support future growth. The funding is in the form of a 7 year, $6,000,000 convertible debt instrument that pays 5% interest annually. Alternatively, the company could have issued debt with a rate of 8% but opted for the convertible debt instrument to preserve cash.

After three years, the company accepted an offer from 30% of the debt holders to convert their debt to ordinary shares.

After five years, the remaining amount of the debt was redeemed at a cost of $4,800,000. At the time comparable risk debt had a rate of return of 7%.

Prepare all journal entries for the issuance, conversion and redemption of the debt.