Clur Limited, a company that prepares its financial statements to 31 December each year, issued

€750,000 of 3% loan stock on 1 January 2017 at a discount of 5%. Issue costs amounted to

€13,175, and interest is payable on 31 December each year. The loan stock is redeemable on 31 December 2020 at a premium of 10%. The effective rate of interest is 7.25%.

Requirement

(a) At what amount should the loan stock be measured on 1 January 2017?

(b) Calculate the amounts at which the loan stock should be recorded in the company’s statement of financial position on 31 December 2017, 2018, 2019 and 2020.