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Question 2 On 1 July 2014 Esso Ltd enters into an arrangement with a US bank - Citu to borrow US$900 000. The term of

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Question 2 On 1 July 2014 Esso Ltd enters into an arrangement with a US bank - Citu to borrow US$900 000. The term of the loan is 3 years with interest payable annually in arrears on 30 June at the rate of 10 per cent. The exchange rate information is: 1 July 2014 30 June 2015 AS1 = USS0.45 AS1 = US$0.55 What journal entries are required in Esso Ltd's books for 1 July 2014 and 30 June 2015 in accordance with AASB 121 (rounded to the nearest whole A$)? Hint: 3 Journal Entries (7 Marks)

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