Explain some of the economic implications for disclosure

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Question - Trojan Ltd issued some convertible bonds to Trevor Ltd. They have a life of five years and pay interest to Trevor Ltd each six months. The convertible bonds will be converted to shares only if Trevor makes the decision, at any time in the next five years, that it would prefer to receive shares in Trojan Ltd, rather than have its funds repaid. Explain some of the economic implications for disclosure of convertible bonds in the books of Trojan Ltd.

Reference no: EM133104768

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