Magpie,bbp qn 21

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May 30, 2021 at 12:06 pm #622292
gayathree1234
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Hi sir,

Crow co issued loan stock $100m.It is repaid in the premium amount of $20m.

1.The amount paid at the end of 5 years is $100m or $20m.
2.How to recognize the finance cost for this question.

Thank you.
May 30, 2021 at 5:12 pm #622336
Kim Smith
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See amortised cost method in Chapter 7 FR notes and lecture – it’s even simpler than Example 2 if there is no coupon interest.
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