SECTION B - Problem Based ((10am to 10.45am AND Submission time until 10.55am) QUESTION 1 MKE Bhd. issued 4,000 6% Convertible Loan Stocks on 1 January 2019 with a face value of RM1,000 per loan stock. The maturity period was three years and interest was payable at the end of each financial year on December 31. Each loan stock is convertible at any time up to maturity into 350 ordinary shares. When the loan stocks were issued, the prevailing market interest rate for similar debt without the conversion option was 9%. Advise MKE Bhd. on how to account for the company's Convertible Loan Stocks in accordance with MFRS 9 Financial Instruments: Recognition and Measurement, by clearly explain the following: a. The nature of Convertible Loan Stocks b. The recognition and measurement Convertible Loan Stocks c. The accounting entries in the initial period of Convertible Loan Stock issuance and throughout its maturity period over 3 years d. The accounting entries at the maturity period if Convertible Loan Stock holders choose: (i) Option 1: Demand for cash repayment; (ii) Option 2: Demand for conversion of loan stocks into ordinary shares e. The relevant amount to be presented in the financial statements of the company (Note that, all necessary computations should be shown and included in the explanations) [Sub-total: 15 marks] [45 minutes)