1) X Ltd issued a loan on 1st January 2015 and classified it as measured at amortised cost. Terms Norminal : GHS 50million Coupon rate : 10% Terms to maturity: 3 years Purchase price: FHS 48million Effective rate : 11.67% Required: Show the double entry for each year to maturity (ignore loss allowance) 2) A company issues GHS 10million of 6% bonds are a price of 100.50 for each GHS 100 norminal value with the issue cost of 50,000. The bonds are redeemable after four years for 10,444,000. The effective annual interest for this financial instrument is 7% Required Calculate the amortised cost of the bond and show the interest for each year to maturity
1) X Ltd issued a loan on 1st January 2015 and classified it as measured at amortised cost. Terms Norminal : GHS 50million Coupon rate : 10% Terms to maturity: 3 years Purchase price: FHS 48million Effective rate : 11.67% Required: Show the double entry for each year to maturity (ignore loss allowance) 2) A company issues GHS 10million of 6% bonds are a price of 100.50 for each GHS 100 norminal value with the issue cost of 50,000. The bonds are redeemable after four years for 10,444,000. The effective annual interest for this financial instrument is 7% Required Calculate the amortised cost of the bond and show the interest for each year to maturity
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1) X Ltd issued a loan on 1st January 2015 and classified it as measured at amortised cost.
Terms
Norminal : GHS 50million
Coupon rate : 10%
Terms to maturity: 3 years
Purchase price: FHS 48million
Effective rate : 11.67%
Required: Show the double entry for each year to maturity (ignore loss allowance)
2) A company issues GHS 10million of 6% bonds are a price of 100.50 for each GHS 100 norminal value with the issue cost of 50,000.
The bonds are redeemable after four years for 10,444,000.
The effective annual interest for this financial instrument is 7%
Required
Calculate the amortised cost of the bond and show the interest for each year to maturity
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