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Financial Assets and Liabilities

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Financial Assets and Liabilities

  • This topic has 5 replies, 2 voices, and was last updated 12 years ago by MikeLittle.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • June 5, 2010 at 10:17 am #44405
    mrasheedat
    Member
    • Topics: 1
    • Replies: 2
    • ☆

    can u pls calculate the the current liabilty charge for me from dis question { a 2%
    debenture issued in 2008 with an issue cost of 1.5m, interest rate is 6% for 6months. In 2011
    investor gets 140m nd the finance cost for the year is 1.4m}. Thanks

    June 5, 2010 at 11:26 am #62041
    MikeLittle
    Keymaster
    • Topics: 26
    • Replies: 22705
    • ☆☆☆☆☆

    I think there’s too much information which you’re not giving me – where have you found the q – give me a reference or a name

    June 5, 2010 at 6:52 pm #62042
    mrasheedat
    Member
    • Topics: 1
    • Replies: 2
    • ☆

    the question was sent to me as well but here is the full question { The 2% Debenture was issued on 1 oct 2008 under term that provide for large premium upon redemption in 2011. The finance dapartment has calculated that the effective interest rate of this type of debt instrument is 6% per annum. Kasabian also paid in cash issue cost of $1.5 million; these have yet to be accounted for. Kasabian intend to hold these debentures to maturity. In Trial balance as at 31 March 2009… 2% Debenture 2011..$140,000, Debenture interest paid $1400}. thanks

    June 6, 2010 at 2:43 pm #62043
    MikeLittle
    Keymaster
    • Topics: 26
    • Replies: 22705
    • ☆☆☆☆☆

    looks like we should be accruing $2,800 (( 6% x 140,000 x 6/12 ) – 1,400 already accounted for )

    this 2,800 will add on to the 140,000 and make the long term liability 142,800

    June 6, 2010 at 8:02 pm #62044
    mrasheedat
    Member
    • Topics: 1
    • Replies: 2
    • ☆

    i mean the current liability not the long term liability.Thanks for your assistance.

    June 9, 2010 at 10:22 am #62045
    MikeLittle
    Keymaster
    • Topics: 26
    • Replies: 22705
    • ☆☆☆☆☆

    yes, the current liability is zero – from the information you have given

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