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A company issues GHS10 million of 6% bonds at a price of GHS100.50 for each GHS100 nominal value with issue costs of GHS50,000. The bonds

A company issues GHS10 million of 6% bonds at a price of GHS100.50 for each GHS100 nominal value with issue costs of GHS50,000.

The bonds are redeemable after four years for GHS10,444,000.

The effective annual interest for this financial instrument is 7%.

Required:

Calculate the amortised cost of the bond and show the interest income for each year to maturity

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