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b ) Stern plc purchased some bonds on 3 1 December 2 0 1 for a price of 9 8 5 . 0 0 million.
b Stern plc purchased some bonds on December for a price of
million. The following information is available about the bond:
Stem plcs financial year ends on December.
Required:
i Using amortised cost, account for the bonds on Stern plcs statement of
financial position and statement of comprehensive income for the financial
year ending December X Show all workings.
ii Explain how your answer to i above would change if the bond was
accounted using Fair Value Through Other Comprehensive Income FVOCIStern plc purchased some bonds on December X for a price of
million. The following information is available about the bond:
Principal redemption amount million
Coupon rate annual
Maturity years
Maturity date December X
Effective interest rate
Expected fair value of bond on December X million
Stern plcs financial year ends on December.
Required:
i Using amortised cost, account for the bonds on Stern plcs statement of
financial position and statement of comprehensive income for the financial
year ending December X Show all workings.
ii Explain how your answer to i above would change if the bond was
accounted using Fair Value Through Other Comprehensive Income FVOCI
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