Question
How are most convertible bonds recorded under current U.S. GAAP?
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Answer
As a single liability, without a separate equity component.
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Question
How do issuance costs affect the carrying amount of debt?
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Answer
They reduce it as a contra-liability.
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Question
Why does discount or premium amortization move carrying value toward face value?
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Answer
So the bond reaches face value at maturity.
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Question
How is times-interest-earned computed?
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Answer
EBIT divided by interest expense.
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