Question 1 1 points Save Answer Luke Ltd issues 3,000 convertible bonds (with a face value of $1,000 per bond) at the start of year 1 at par. They have a three-year term and can be redeemed at par at the end of the team. Interest is payable annually in arrears at 7% per annum. Each bond is convertible at any time up to maturity into 250 ordinary shares at holder's option. When the bonds are issued the prevailing market interest rate for similar debt without conversion options is 9%. Required: Which of the following statements regarding the convertible bonds is not true? The convertible bonds will affect gearing due to the liability component being different from the sum of the liability and equity components. 7% interest will be charged to the statement of profit or loss as a finance cost. The equity amount will remain fixed until the date of conversion. p. The balance of liability at end of year 3 will be $3 million before the holder decides the option. Destion 1 1 points Sove Answer Which one of the following would require a provision in terms of principle stated in HKAS 32 Provisions, Contingent Liability and contingent Assets" to be created by XYZ Ltd at its reporting date of 31 March 20207 A AL 31 March 2020, XYZ is negotiating with its insurance provider about an outstanding insurance claim. The provider agreed to pay $200,000 before the issue date of financial statements. The government introduced new laws on data protection which come into force on 1 May 2020.XYZ's directors have agreed that this will require a large number of staff to be retrained. At 31 B. March 2020, the directors were waiting on a report they had commissioned that would Identify the actual training requirements. C XYZ makes refunds to customers for any goods sold at 31 March 2020 that will return within 30 days of sale, and has done so for many years. A customer is suing XYZ for damages alleged to have been caused by XYZ's product, XYZ is contesting the claim and at 31 March 2020 the directors have been advised by XYZ's legal advisors D.that it is very unlikely to lose the case