Requirement A: Requirement B:

Assume that a foreign company using IFRS is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes. Izmir A.S. issued convertible bonds at their face value of 114,000 lira on December 31, 2020. The bonds have a 12-year life with interest of 9 percent payable annually. At the date of issue, the prevailing interest rate for similar debt without a conversion option was 11 percent. Required: a. Prepare journal entries for this compound financial instrument for the year ending December 31, 2020, under (1) IFRS and (2) U.S. GAAP. b. Prepare the entry(ies) that the U.S. parent would make on the December 31, 2020, conversion worksheet to convert IFRS balances to U.S. GAAP. Required A Required B Prepare journal entries for this compound financial instrument for the year e GAAP. (If no entry is required for a transaction/event, select "No journal ent decimals. Round your intermediate and final answers to nearest whole dolla View transaction list X 1 Record the entry for the issue of bonds as per IFRS. 2 Record the entry for the issue of bonds as per U.S. GAAP. Required A Required B Prepare the entry(ies) that the U.S. parent would make on the December 31, U.S. GAAP. (If no entry is required for a transaction/event, select "No journal to 7 decimals. Round your intermediate and final answers to nearest whole do View transaction list 1. X 1 Record the conversion entry needed for 12/31/20. 2 Record the conversion entry needed for 12/31/21