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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
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.
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.
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