Question 2 (6 marks)

BEXI company issues $15 Million five-year, 12 per cent, semi-annual coupon

debentures to the public which pays interest every six months. The market also

requires a rate of return of 12 per cent. Assume that all the money comes in and the

debentures are allocated on the same day, 30 June 2019.

Provide the accounting entries as at 30 June 2019, 31 December 2019 and 30 June

2024 to record:

1. The receipt of funds (4 marks)
2. The first payment of interest (1 mark)
3. The redemption of the debentures (1 mark)