Page 55 - Ebook Financial Accounting 3

31 December 2020

Interest expenses (RM13,452,000 x 8%) 1,076,160
Bank 750,000

5% debentures 326,160

(Interest paid for second year)

2. Liability measured at fair value

RM
Nominal value 15,000,000

Less: Discount (1,500,000)

13,150,000
The debentures are issued at a discount of 10 percent on the nominal value. The interest of 5

person will be paid annually and transaction cost will be charged as expenses.

Dr Cr
RM RM

1 January 2019
Proceeds from issue of debentures

Bank 13,500,000

5% debentures 13,500,000
(Discount of 10%)

Transaction Expenses 350,000
Bank 350,000

(Paid transaction cost as expenses)

31 December 2019

Interest expenses (RM15,000,000 x 5%) 750,000
Bank 750,000

(Interest paid for first year)

Profit or Loss (SOCI) 500,000

5% debentures 500,000

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