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6% preference shares of $1 each (note (ii)) 52,000 Preference dividend paid (note (ii)) 3,000 The 6% preference shares were issued at par on 1 April 20X3 for $50 million. They are redeemable at a large premium which gives them an effective finance cost of 10% per annum. Their solution (W3) Preference shares Year b/f Interest @ 10% Payment c/f $000 $000 $000 $000 31 March 20X4 52,000 5,200 (3,000) 54,200 To finance costs Per trial balance To NCL Dear sir, is there a printing error in the q? Shouldnt it be 50000(bal b/f) + 5000(effective interest)- 3000(interest paid) = 52000(at 31 march 20X5) Ur assistance is kindly needed as i am having my paper on 9th Thanks a lot