Which Statement Best Describes the "Zero Common Equity Method

Which statement best describes the "zero common equity method"?

A) Under this method of accounting,for a convertible bond,all of the bond value would be counted as a liability.
B) Under this method of accounting,for a convertible bond,the issuing entity would record a liability for the estimated value of the bond without the conversion feature.
C) Under this method of accounting,for a convertible bond,an estimate would be made of the fair value of all components and allocated proportionally to all components.
D) Under this method of accounting,the common share component is considered the least reliably measured amount.