Question
On 1 January 2011 Oxygen Limited purchased a debt instrument for its fair value of Rs. 500,000. It had a principal amount of Rs. 550,000
On 1 January 2011 Oxygen Limited purchased a debt instrument for its fair value of Rs. 500,000. It had a principal amount of Rs. 550,000 and was due to mature in five years.
The debt instrument carries fixed interest of 6% paid annually in arrears and has an effective interest rate of 8%. It is held at amortized cost.
Required
At what amount will the debt instrument be shown in the statement of financial position of Oxygen Limited as at 31 December 2012?
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Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
9th Edition
125972266X, 9781259722660
