Exercise 1

Fair Value of Convertible Bonds

Less: Fair Value of Liability Component
Equity Component
Converted at maturity date
Share Premium - Conversion Equity
Bonds Payable
Share Capital - Ordinary
Share Premium - Ordinary
Converted at January 1 20X2
Share Premium - Conversion Equity
Bonds Payable
Share Capital - Ordinary
Share Premium - Ordinary

Issuance
Cash
Share Capital - Preference
Share Premium - Conversion Equity
Conversion
Share Capital - Preference
Share Premium - Conversion Equity
Share Capital - Ordinary
Share Premium - Ordinary
Fair Value of Bonds + Warrant
Less: Fair Value of Liability Component
Equity Component

Convertible Bonds
10,000,000 Journal
10,000,000
0.48519
4,851,939 Cash
10,000,000
600,000
6.86408
4,118,449
Bonds Payable
8,970,388
1,029,612
Share Premium - Conversion Equity
1,029,612
Repurchased at January 1 20X2
1,029,612
FV Liability Component
10,750,000
10,000,000
CA Liability Component
9,121,404
1,000,000
Loss on repurchase
1,628,596
10,029,612
FV Convertible Bonds
11,500,000
1,029,612
FV Liability Component
10,750,000
9,121,404.47
FV of Equity
750,000
1,000,000
9,151,017
Share Premium - Conversion
750,000
Bonds Payable
9,121,404
Loss on Repurchase
1,628,596
Cash
11,500,000
Preference Shares
Repurchase
7,500,000
Share Capital - Preference
5,000,000
5,000,000
Share Premium - Conversion
2,500,000
2,500,000
Retained Earning
2,500,000
Cash
10,000,000
5,000,000
2,500,000
2,000,000
5,500,000
Share Warrants
12,250,000 Journal
12,000,000
0.56743
6,809,122 Cash
12,250,000
1,200,000
3.60478
4,325,731
Bonds Payable
11,134,854
1,115,146
Share Premium - Share Warrants
1,115,146

Exercise
Cash
Share Premium - Share Warrants
Share Capital - Ordinary
Share Premium - Ordinary

Grant Date - January 4 20X2

(no entry)
31 December 20X2, 20X3 & 20X4
Compensation Expense
Share Premium - Share Option

Grant Date - June 31 20X2

Unearned Compensation
Share Capital - Ordinary
Share Premium - Ordinary
December 31 20X2
Compensation Expense
Unearned Compensation
Dates Outstanding
Jan 1 - Feb 28
Feb 29 - 30 April
May 1 - July 30
July 31 - 30 Sept
1 Oct - Dec 31
Weighted Average Shares Outstanding
Basic EPS

600,000
557,573 >kalo sisanya ga diexercise di transfer ke share premium ordinary
300000
857,573
Share Option Plans
Exercise Date
Cash
Share Premium - Share Option
5,000,000
Share Capital - Ordinary
5,000,000
Share Premium - Ordinary
Expiration Date
Share Premium - Share Option
Share Premium - Expired
Restricted Shares
Forfeited
6,600,000
Share Capital - Ordinary
3,000,000
Share Premium - Ordinary
3,600,000
Compensation Expense
Unearned Compensation
1,100,000
1,100,000
Weighted Average Shares Outstanding
Shares Out
Restatement Fraction
Weighted Shares
30000
2
1/6
10,000
50000
2
1/6
16,667
45000
2
1/4
22,500
55000
2
1/6
18,333
110000
1/4
27,500
95,000
Earning Per Share
15,000,000 - (400,000 x 75%)
153.684
Diluted EPS
95000

5,625,000
11,250,000
5,000,000
11,875,000
3,750,000
3,750,000

3,000,000
3,600,000
1,100,000
5,500,000

115.21

Diluted Effect
Convertible Bonds
Convertible Preference
Share Warrants

720,000
10,000
400,000
2,000
22,500

72
200
0

Exercise 2
Preference shares dividend
106250
Basic EPS
1,500,000 - 106,250
1.39375
1,000,000
Dilutive Effect
Convertible Bonds
7% x 5,000,000 x 60%
0.84
250000
Options
0
0
25,000
Proceed from exercise
Share issued
100,000
T/S purchased
75,000
Incremental share outstanding
25,000
Diluted EPS 1,500000-106,250+210,000+0
1.2578
1,000,000+250,000+25,000
Homework 1
1/1/2007 No Entry
1/2/2007 No entry
12/31/2007 Compensation Expense
Share Premium - Share Options
12/31/2008 Compensation Expense
Share Premium - Share Options
1/2/2009 Cash
Share Premium - Share Option
Share Capital Ordinary
Share Premium Ordinary
Share Premium - Share Option
Share Premium - expired

Homework 2
a. Weighted average shares outstanding
Date
Shares Outstading Fraction average shares
1 jan-1 Apr
220,000
3/12
55,000
1 apr - 1 sept
240,000
5/12
100,000
1 sep - 31 des
210,000
4/12
70,000
b. basic EPS
900,000 - 140,000
3.378
225,000
Effect
Options
0
0
6,000
Proceed from exercise
Share issued
30,000
T/S purchased
24,000
Incremental share outstanding
6,000
Convertible PS
7 x 20,000
2.33
20,000 x 3
Convertible Bonds
650,000
8% x 2,000,000 x 60%
2.4
650,000
40,000
650,000
Diluted EPS
650,000
996000
3.01
1,920,000
331000
1,040,000
480,000
2,480,000
260,000
260,000