Proceeds from an Issue of Debt Securities Having Share Warrants

question 43

Multiple Choice

Proceeds from an issue of debt securities having share warrants should not be allocated between debt and equity features when

• A)the fair value of the warrants is not readily available.
• B)exercise of the warrants within the next few fiscal periods seems remote.
• C)the warrants issued with the debt are non-detachable.
• D)Proceeds should be allocated between debt and equity for all of these.

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Definitions:

Realistic Accuracy Model

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Judge

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