# 4 On 1 July 2020 Double Island Ltd enters into an agreement to borrow 4,750,000 from Point plc of UK. Point plc sends the loan money to Double Island Ltds Australian bank account. The loan is for Three years and requires the payment of interest at the rate of 8 per cent on 30 June each year. Double Island Ltds reporting date is 30 June. The exchange rates at the relevant dates are: 1 July 2020 A$1.00 = UK0.475 30 June 2021 A$1.00 = UK0.500 30 June 2022 A$1.00 = UK0.475 Required: Prepare and provide the necessary journal entries that would be made in the books of Double Island Ltd to account for the above transactions from 1 July 2020 until 30 June 2022. [20 Marks] Do you think that the fluctuation of UKs pound made Australian Double Island Ltd to pay more or less in settling the debt from UKs Point plc. You need to justify your arguments. [05 Marks]