Convertible preference shares 4. a. Are compound instruments with both a liability and an equity componentd b. Include an option for the holder to convert preference shares into a fixed number ordinary shares. Use the "with-and-without" method to value the compound instrument. All of these answer choices are correct. c. d. Comment 5. The interest rate written in the terms of the bond indenture is known as the a. coupon rate only. b. nominal rate only. c. stated rate only d. coupon rate, nominal rate, or stated rate. Comment 6. In a debt extinguishment in which the debt is settled by a transfer of assets with a fair value I than the carrying amount of the debt, the debtor would recognize a. no gain or loss on the settlement. b. a gain on the settlement. c. a loss on the settlement. d. None of these answer choices are correct. Comment 7. When a restructuring involves the sale of an operation, at what point may an obligation a under IAS 37? a. When business is marketed for sale b. When a preferred buyer is located c. When an expression of interest is filed d. When a binding sale agreement is executed Comment 8. Which of the following best describes the accounting for assurance-type warranty costs? a. Expensed when paid. b. Expensed when warranty claims are certain. c. Expensed based on estimate in year of sale. d. Expensed when incurred. Comment