24-On Jan1, 2020, Khariff Company issued a 6-year, 14%, OMR 200,000 face value bond at 106 (6% above par). Interest is payable each year on Jan 1 and July 1. The company year-end is December 31 and follows IFRS. Determine the carrying value of bonds payable as on December 31,2020. a. OMR 202,000 b. None of the option is correct c. OMR 210,000 d. OMR 200,000
24-On Jan1, 2020, Khariff Company issued a 6-year, 14%, OMR 200,000 face value bond at 106 (6% above par). Interest is payable each year on Jan 1 and July 1. The company year-end is December 31 and follows IFRS. Determine the carrying value of bonds payable as on December 31,2020. a. OMR 202,000 b. None of the option is correct c. OMR 210,000 d. OMR 200,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
Question
24-On Jan1, 2020, Khariff Company issued a 6-year, 14%, OMR 200,000 face value bond at 106 (6% above par). Interest is payable each year on Jan 1 and July 1. The company year-end is December 31 and follows IFRS. Determine the carrying value of bonds payable as on December 31,2020.
a.
OMR 202,000
b.
None of the option is correct
c.
OMR 210,000
d.
OMR 200,000
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education