Q.On 30 June 2023, Moon Ltd. issues 90,000 $2 redeemable convertible notes. The notes pay interest at 7% p.a. Each note converts at any time at the option of the holder into one ordinary share. The notes are redeemable at the option of the holder for cash after 5years. If, at the end, the notes have not been redeemed or converted, they cease to carry interest. Market rates for similar notes without the conversion option are 9% p.a

Table - Present Value of an annuity of $1			Table - Present Value of $1
Period	7%	9%	Period	7%	9%
1	0.9346	0.9174	1	0.9346	0.9174
2	1.8080	1.7591	2	1.8080	0.8417
3	2.6243	2.5313	3	2.6243	0.7722
4	3.3872	3.2397	4	3.3872	0.7084
5	4.1002	3.8897	5	4.1002	0.6499

Q7. Identify and justify whether Moon Ltd. has a financial liability or equity instrument or both resulting from this financial instrument under IAS 32.

Q8. Present the relevant journal entries to recognise this financial instrument including the working process to measure this instrument on 30 June 2023.