Required:
In deciding how to account for the issuance of the MEDS, address the following issues:
• Should the various components of each MEDS be accounted for separately? If so, how should Ace allocate the proceeds received among the components?
• Should each MEDS (if accounted for as one unit of account) or the components of the MEDS (if accounted for separately) be accounted for as a derivative, or should any embedded derivatives be accounted for separately.