On january 1,2014, Tudor Company issued its 10%, 5-year convertible debt instrument with the face amount of P10,000,000 for P10,000,000. Interest is payable every December 31 each year. The debt instrument is convertible into 90,000 ordinary shares with the par value of P100. When the debts instruments were issued, they were selling at 97% without conversion option. Tudor company incurred P80,000 transaction cost to issue the debt instrument.

a. How much of the net proceeds represents equity component? b. How much of the net proceeds represents debt component?