Subject: Accounting

Classify each financial instrument as debt, equity, or part debt and part equity. Explain your reasoning.

A)Voting, annual $4 non-cumulative dividend, redeemable at investor's option for $60 per share.

B)Notes Payable, interest of 4%, interest reset every 5 years at market rate, principal to be repaid at dissolution of company, may be repaid on company's option on interest repricing dates.

C)Preferred Shared, annual $6 cumulative dividend, convertible to 4 common shares for every $100 preferred share at the investor's option, redeemable at $32 per share at company's option in 2010.

D)8% debentures payable, interest payable in cash semi-annually, due in 2008. At maturity, the face value of the debentures may be converted, at the company's option, into common shares at a price of $12.50 per share.

E)8% debentures payable, interest payable semi-annually, due in the year 2008. At maturity, the Face value of the debentures may be converted, at the company's option, into common shares at the market price at that time. Interest may also be paid in shares using the market value of shares at the interest payment date.

F)Series A first preferred shares carrying a fixed cumulative dividend of $2.10 per share increasing by $4.20 in 2008. The shares are redeemable at the company's option at a price of $45 per share until Dec 31, 2007 and at a price of $96 per share thereafter.

G)Series F first preferred shares, carrying a fixed cumulative dividend of $3 per share per annum, redeemable at the company's option at $40 per share.