Convertible Loan Treatment

Hello there,
Can anyone help with the following scenario?
I am not entirely sure on the accounting treatment / double entry:

SCENARIO

On 15th May 20X5 Company A issues a cash loan of $40,000 accruing interest at 5%. [ is this a zero-coupon loan?]

The Company will also issue to the same lender a Warrant to purchase a number of common shares in the company equal to the number of $ lent. The Warrant has an exercise price of $0.50 paid over 5 years.

The loan will have to be repaid in full plus accrued interest no later than 31st Aug 20X5.

The warrant entitles the lender to purchase from the issuer up to 10,000 fully-paid & non-assessable shares at the price of $0.50 per share.
The warrant is exercisable on 15th 20Y0.

So my questions are:

1) is it correct to discount the interest of $2,000 [40k x 5%] up to year 4 and at year 5 discount the whole $40k?
By doing so I obtain a liability of $38,432.95, which means the equity element [share option] comes to $1,567.05.

My dbl entries being:
15th May 20×5

Dr Bank $40K
Cr Liability $38,432.95
Cr Equity Share Option $1,567.05

2) Do I then amortise the liability of $38,432.95 [opening bal] calculating interest @ 5%
[do I time apportion this being the loan issued on 15th May 20X5, $892.57? or do I keep it in full , $1921.65?]

3) [and this is where I am not sure at all]
since this seems to be a zero-coupon conv. loan I don’t have any cash paid [3rd column of my calcs] to subtract from the liability of $38,432.95 less interest.
Do I then carry on with the amortisation of the loan until year 5? If not how should I calculate this?
If I do what is the year 5 interest & Cash paid?

4) as per the warrant this comes to $5,000, right? 10,000 shares @ $0.50.
The dbl entry for this will be:

Dr Liability $5K [effectively it reduces my liability of $38,432.95, right?]
Cr Warrant $5K [will this sit in my reserves under “Warrant”?]

Sorry for the lengthy message – I hope someone can help.

Thanks,