On May 1, 2018, Al Mazoon Finance Ltd., issued 10 years, 5 %, OMR 100,000 face value bonds at OMR 102. Interest is payable each year on May 1 and November 1. The company closes its books of accounts on December 31st every year and the company follows IFRS.

Required:

a) Pass the necessary journal entries in the books of accounts of Al Mazoon Finance Ltd for 1 year. (6 Marks)

b) Prepare interest account and interest payable account (2 Marks)

c) show the carrying value of bond to be recorded in the balance sheet at the end of the year.