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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › dec 2011 FA
Can you please kindly explain financial asset part on Dec11 Q1. It says Included in the financial assets of Traveler is a ten year 7% loan held at amortized cost. At 30 Nov 2011, the borrower was in financial difficulties and its credit rating had been downgraded. At this date, the gross carrying amount of the loan asset was and loss allowance was $1 million.Traveler has agreed for loan to be restructured; there will only be three more annual payments of $8 million starting in year’s time.Current market interest rate are 8%, the original effective interest rate is 6.7% and the effective interest rate under the revised payment schedule is 6.3%.
Hi,
What is it exactly that you want me to explain please? If you get back to me then I will gladly help but I’m not just going to answer the full question for you, a bit of work on it is required first.
Thanks