Avrams Inc issued 500 bonds on December 31, 2018. Details of that bond issuance are as follows.

Number of bonds	500
FV of each bond	$1,000
stated annual interest rate	10%
interest payment schedule	semi-annual
Redemption date	Dec 31, 2023

Avrams' first interest payment was June 31, 2019. Avram's incremental borrowing rate at the time of bond issuance was 6%.

Required:

(a) 9 marks Avrams is now preparing for their December 31 year-end and the CFO has asked you to provide the following balances at year end: (i) bond payable; (ii) interest expense.

(b) 7 marks Avrams is considering buying back the bonds in 2021 and the CFO has asked for your guidance. Specifically, what amount will be recorded as gain or loss if Avrams pays bondholders $550,000 (interest included) at May 31, 2021?

(c) 2 marks For business reasons, Avrams is considering changing their year end date. The CFO (who doesn't seem terribly clever) asks you what (if any) changes will occur to: (i) bond payments and (ii) the financial statements accounts (SFPosition and SFPerformance)