Example:

On Jan. $1,2015,$ Scarlet issued $$200$ million of $5\%$ convertible bonds due in $20$ years at $103.$

Each $$1000$ bonds included $10$ warrants. Each warrant permitted the holder to buy one share of

no par common stock at $$20$ at a future date. Violet Corporation purchased $10\%$ of these bonds

$($also receiving the associated warrants$).$ The warrants were immediately listed on the stock

exchange at $$1$ per warrant.

How many warrants were issued in total?

On Dec. $31,2021,$ Violet still held all of their initially purchased warrants and exercised all of

them purchasing stock. What journal entry does Scarlet record at this time?