1. Ahmed ltd. is one of the leading business group in Sultanate of Oman. More than 2000 employees are working in this group. With its commitment and strong focus in providing engineering solutions to the Oil & Gas, Petrochemicals, Power, Water and Wastewater sectors, Ahmed ltd. Group has been structured into three Strategic Business Units (SBUs): Contracting, Trading & Manufacturing. With its commitment and strong focus in providing engineering solutions to the Oil & Gas, Petrochemicals, Power, Water and Wastewater sectors, Ahmed Group has been structured into three Strategic Business Units (SBUs): Contracting, Trading & Manufacturing.

1. Ahmed ltd owns 462,000 shares of Ruwaida. Ruwaidas total issued and paid up equity capital is OMR 2,100,000. Apart from the shares held by Ahmed ltd. the other shares in Ruwaida were held by many other shareholders. In January 2015, Arib Ltd. came up with an offer to acquire all the shares of Ruwaida including the shares held by Ahmed ltd. The offer was accepted by the remaining shareholders and they sold the shares to Arib ltd. Ahmed ltd did not sell and held the investments in Ruwaida.

Required:

1. What is the percentage of investments held by Ahmed Ltd.? Which method of Accounting should be used by Ahmed Ltd. for their investments in Ruwaida?(2 marks)

b. Explain how the investment in Ruwaida should be treated in the Statement of Comprehensive Income of Ahmed ltd for the year ended 31st March 2019 and the consolidated statement of financial position at 31^st March 2019. (4 marks)

2. On January 1, 2015, Ahmed. issued bonds with a par value of OMR 600,000 at 96, due in 2030. On January 1, 2025, the entire issue was called at 102 and cancelled. Interest is paid annually, and the discount is amortized using the straight-line method.

1. Compute the profit or loss on the redemption. Explain why discount is amortized? (3 marks)
2. What is the procedure followed to amortize the bonds? (1 marks)