Which of the following represents one of the reasons why the FASB decided to simplify the legacy GAAP guidance on accounting for convertible instruments?

a. It was unnecessarily complex.

b. It often results in conclusions based on substance rather than form.

c. Users generally analyzed convertible instruments as multiple units.

d. Convertible instruments can no longer be classified in equity.

When the underlying shares of a conversion option are worth more than the par value of the convertiblo instrument. the convertible instrument is said to be which of the following.

a. "Out-of-the-money:

b in-the-money

C. At the money

D. Unvested

While the term "substantial premium" has not been defined in the accounting guidance, it has generally been interpreted to be.

% or more of the principal amount of the note.

A. 5

B. 10

C. 20

D. 15

Which of the following applies to convertible debt with a cash conversion feature?

a. A convertible preferred share that is classified in equity or temporary equity

b. A convertible debt instrument that requires or permits settlement in cash (or other assets) upon conversion only in specific circumstances in which the holders of the underlying shares also would receive the same form of consideration in exchange for their shares.

c. A convertible debt instrument that requires an issuer's obligation to provide consideration for a fractional share upon conversion to be settled in cash but that does not otherwise require or permit settlement in cash ( or other assets) upon conversion.

D. A convertible debt instrument that allows or requires the reporting entity to settle its obligation upon conversion in whole or in part in a combination of cash or stock at that investor or issuer option or mandatorily.

Under ASU 2020-06, which of the following is not a part of the specific disclosures for convertible debt only?

a. The unamortized premium, discount and/or issuance costs.

b. The amount of interest recognized for the period disaggregated by contractual interest and amortization of the premium, discount or issuance costs.

c. The amount of dividends declared for each period in which a statement of financial performance is presented.

d. For public business entities, the fair value of each instrument and the level in the fair value hierarchy.