The December $31,2025,$ balance sheet of Novak Corp. is as follows. The December $31,2025,$ balance sheet of Novak Corp. is as follows.

$10\%$ callable, convertible bonds payable $($semiannual interest

dates April $30$ and October $31$; convertible into $6$ shares of $$25$

par value common stock per $$1,000$ of bond principal; maturity date April $30,2031)$ $$370,000$

Discount on bonds payable

$10,688$

$$359,312$

On March $5,2026,$ Novak Corp. called all of the bonds as of April $30$ for the principal plus interest through April $30.$ By April $30,$ all

bondholders had exercised their conversion to common stock as of the interest payment date. Consequently, on April $30,$ Novak Corp.

paid the semiannual interest and issued shares of common stock for the bonds. The discount is amortized on a straight$-$line basis.

Novak uses the book value method.

Prepare the entries to record the interest expense and conversion on April $30,2026.$ Reversing entries were made on January $1,2026.$

$($List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If

no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts.$)$

Account Titles and Explanation

Interest Expense

Cash

Discount on Bonds Payable

$($To record interest expense.$)$

Discount on Bonds Payable

Common Stock

Paid$-$in Capital in Excess of Par $-$ Common Stock

$($To record the conversion.$)$

Debit

Credit

$10\%$ callable, convertible bonds payable $($semiannual interest

dates April $30$ and October $31$; convertible into $6$ shares of $$25$

par value common stock per $$1,000$ of bond principal; maturity date April $30,2031)$

Discount on bonds payable

$$370,000$

$10,688$

$$359,312$

Debit

Credit

$19168$

On March $5,2026,$ Novak Corp. called all of the bonds as of April $30$ for the principal plus interest through April $30.$ By April $30,$ all

bondholders had exercised their conversion to common stock as of the interest payment date. Consequently, on April $30,$ Novak Corp.

paid the semiannual interest and issued shares of common stock for the bonds. The discount is amortized on a straight$-$line basis.

Novak uses the book value method.

Prepare the entries to record the interest expense and conversion on April $30,2026.$ Reversing entries were made on January $1,2026.$

$($List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If

no entry is required, select $"$No Entry" for the account titles and enter O for the amounts.$)$

Account Titles and Explanation

Interest Expense

Cash

$18500$

Discount on Bonds Payable

$($To record interest expense.$)$

Bonds Payable

$668$

$370000$

Discount on Bonds Payable

$10020$

Common Stock

$55500$

Paid$-$in Capital in Excess of Par $-$ Common Stock

$($To record the conversion.$)$

$304480$