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12. Accounting for convertible debt is both a theoretical and practical problem in accounting. Is it a debt instrument, an equity instrument, or both? Under

12. Accounting for convertible debt is both a theoretical and practical problem in accounting. Is it a debt instrument, an equity instrument, or both? Under accounting standard APB Opinion 14 the amount of the conversion feature of convertible debt should be shown as

A. a liability

B. equity

C. a special item between liabilities and equity

D. separate components shown as both equity and liabilities

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