How will the finance cost be cal culated and what the double entry will be for a compound instrument calculated as follows: Liability component P.V Principal $1,544,400 + P.V. Interest annuity $253,100. Equity component bal fig. $202,500
I am having a hard time seeing how the cost will be entered annually. bond is for three years. discount factor 9%, interest paid annually in arrears at 5% of principal $2million.