The following are independent scenarios.
1. Rial Corp. designated convertible bonds as fair value through profit or loss (FVPL) on initial recognition. Management is unsure how to handle the liability for purposes of diluted EPS.
2. Hekah Inc. issued bonds which are convertible at the company’s option. Management now has a strong inclination to repay the bond with cash rather than shares and therefore does not feel inclusion is required for diluted EPS calculations.
3. Henly Corp. uses the average share price to determine whether options are in-themoney or not and to calculate the share adjustment the denominator of diluted EPS. For the 20X7 year-end diluted EPS calculation, management is having trouble. This is because the average share price was $50 for the year but now at the end of the year it has fallen to $35. The options outstanding have a per-share price of $40. Management is unsure if the average share price is appropriate to determine whether these options are in-the-money.
4. Elon Corp. has suffered a loss from continuing operations in 20X2. Management plans on only releasing basic EPS for 20X2.
5. Assume the facts in scenario 4, but also that in 20X2 Elon Corp. suffered a loss from continuing operations and a gain from discontinued operations.

Required:
For each scenario, describe the appropriate treatment.