On January 1, 2014, ABC Incorporated Issued $10,000,000 Face Amount

Essay

On January 1, 2014, ABC Incorporated issued $10,000,000 face amount of 8%, 10 year, subordinate convertible debentures at face value in a private placement.The debentures pay interest annually, in cash, on 31 December.The bonds were issued for $12 million, and that the market rate was 6%:
Prepare Journal entries to record the issuance of the bonds on January 1, 2014.