The issue price of the bond as per IFRS. Given information: Company issued bonds worth $850,000. Term period for conversion is 6 years Interest is payable semi-annually each January 1 and July 1. Market rate of interest is 10%. Effective rate of interest is 8%.

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Answer 1

Question

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

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Answer 2

Question

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

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Answer 3

Question

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

Expert Solution & Answer

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Answer 4

Question

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

Expert Solution & Answer

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Answer 5

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

Answer 6

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

Answer 7

Chapter 14, Problem 14.15E

a.

To determine

The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

Answer 8

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

Answer 9

b.

To determine

To prepare: The amortization table for the bond issue as per IFRS.

Answer 10

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

Answer 11

c.

To determine

To prepare: The journal for recording the required entries on the date of issue.

Answer 12

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

Answer 13

d.

To determine

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

Answer 14

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Answer 15

Expert Solution & Answer

Answer 16

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Answer 17

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The issue price of the bond as per IFRS. Given information: Company issued bonds worth $850,000. Term period for conversion is 6 years Interest is payable semi-annually each January 1 and July 1. Market rate of interest is 10%. Effective rate of interest is 8%.

Solution Summary: The author calculates the issue price of the bond by multiplying the historical market rate of interest by the beginning balance of debt.

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The issue price of the bond as per IFRS.

Given information:

Company issued bonds worth $850,000.

Term period for conversion is 6 years

Interest is payable semi-annually each January 1 and July 1.

Market rate of interest is 10%.

Effective rate of interest is 8%.

To prepare: The amortization table for the bond issue as per IFRS.

To prepare: The journal for recording the required entries on the date of issue.

To prepare: The journal for recording conversion of bond at the end of third year as on January 1, 2021.

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Chapter 14 Solutions