estion (a) Eko Bhd's financ e ends on 30 June, On 1 July 2014. Eko Bhd issued RM10 million convertide kan stock at its nominal value of RM1,000 each The loan stock has a fixed interest rate of 6% per annum and will mature at the end of June 2018. Each unit of the loan stock is convertible into 200 ordinary shares per RM1 at any time up to maturity. Any loan stocks not converted by the maturity date will be redeemed for cash at its nominal value. At the date of issue of the loan stock, the prevailing interest rate of similar class of loan stock without the conversion option was 10% Present Value Factors Period 1 0 2 0 3 0 6% .94340 .8900 .8396 0.7921 0.7473 10% .9091 0.8284 0.7513 0.8830 0.6209 Required: Explain and show how the convertible loan stocks are to be presented in the statement of financial position of Eko Bhd as at 30 June 2018 in order to comply with the requirements of MERS 132 Financial Instruments: Presentation. Support your answer with suitable calculations. [14 marks] (b) The following information is extracted from the accounting records of Catrina Bhd as at 30 June 2019: Carrying Amount RM'000 20,400 Tax Base RM'000 18.000 Property, plant and equipment Provision for warranty 18,000 12.000 The company has a deferred tax liability of RM500,000 as at 1 July 2018 There are no temporary differences arising from its other assets and liabilities as at 30 June 2019. The company estimated that there would be insufficient taxable profits for the year ended 30 June 2019 to utilise deferred tax assets, if any. Income tax rate for 2019 is 24% Required: Advise the company on the recognition of deferred tax asset or deferred tax liability and the deferred tax income or deferred tax expense for the year ended 20 June 2010 in accordance with MFRS 112 Income Taxes. (Show all relevant workings) [16 marks) END OF QUESTION PAPER estion (a) Eko Bhd's financ e ends on 30 June, On 1 July 2014. Eko Bhd issued RM10 million convertide kan stock at its nominal value of RM1,000 each The loan stock has a fixed interest rate of 6% per annum and will mature at the end of June 2018. Each unit of the loan stock is convertible into 200 ordinary shares per RM1 at any time up to maturity. Any loan stocks not converted by the maturity date will be redeemed for cash at its nominal value. At the date of issue of the loan stock, the prevailing interest rate of similar class of loan stock without the conversion option was 10% Present Value Factors Period 1 0 2 0 3 0 6% .94340 .8900 .8396 0.7921 0.7473 10% .9091 0.8284 0.7513 0.8830 0.6209 Required: Explain and show how the convertible loan stocks are to be presented in the statement of financial position of Eko Bhd as at 30 June 2018 in order to comply with the requirements of MERS 132 Financial Instruments: Presentation. Support your answer with suitable calculations. [14 marks] (b) The following information is extracted from the accounting records of Catrina Bhd as at 30 June 2019: Carrying Amount RM'000 20,400 Tax Base RM'000 18.000 Property, plant and equipment Provision for warranty 18,000 12.000 The company has a deferred tax liability of RM500,000 as at 1 July 2018 There are no temporary differences arising from its other assets and liabilities as at 30 June 2019. The company estimated that there would be insufficient taxable profits for the year ended 30 June 2019 to utilise deferred tax assets, if any. Income tax rate for 2019 is 24% Required: Advise the company on the recognition of deferred tax asset or deferred tax liability and the deferred tax income or deferred tax expense for the year ended 20 June 2010 in accordance with MFRS 112 Income Taxes. (Show all relevant workings) [16 marks) END OF QUESTION PAPER