User Account

All Pages

Determine which inflows or outflow will appear in statement

Assignment Help Financial Accounting
Reference no: EM132791572

BA Limited is a company based in Melbourne, Australia. The year end is 30 June.

On 1 July 2019, BA Ltd acquired a 3 year fixed rate corporate bond which has been classified as amortised cost under IFRS 9 Financial Instruments. BA Ltd acquired the corporate bond for $480,000 and incurred $2,000 in transaction costs for the investment.

Details of the corporate bond are as follows:

Face value $500,000; Annual coupon rate 6% paid on 30th June each year

Effective interest rate 7.3813%; Maturity date 30 June 2022.

The bond is not a designated hedge instrument.

Instead, holding the bond until its maturity date ( 30 June 2022). BA Ltd decided to sell the bond earlier to obtain the cash needed to invest in a new project. On 30 June 2021, BA Ltd received the annual coupon on the bond and then immediately sold the bond for $495,000.

TASK:

For the bond for the year ended 30 June 2021

Problem a) Prepare the journal entries to account for the bond. Show all workings.

Problem b) Determine which inflows or outflows will appear in the statement of cash flows. Ensure your response includes both amounts and classification.

Reference no: EM132791572

Questions Cloud

Name the 4 quadrants of the service process matrix : Name the 4 quadrants of the service process matrix, Discuss how the matrix is used to classify services into categories.
What are some outsourcing opportunities in a restaurant : What are some outsourcing opportunities in a restaurant? What supply chain issues are unique to a firm sourcing from 35 countries?
Determine the net cash flow from financing activities : Burich Co. reported short-term borrowings of $2.5 million, long-term borrowings of $6.8 million, Determine the net cash flow from financing activities
Discuss risks-issues facing the company : Discuss FOUR risks/issues facing the company, due to the global sourcing strategy.
Determine which inflows or outflow will appear in statement : Determine which inflows or outflows will appear in the statement of cash flows. Ensure your response includes both amounts and classification.
What is the current stock price : If the required return on the company's common stock is 11% per year, what is the current stock price
Discuss the four types of process strategies : Discuss the four types of process strategies and give an example of each. Also, please share any personal industry experiences (if any) with each process strate
What is the npv of the project for bore industries : Using the APV method, what is the NPV of the project? Bore's unlevered cost of capital is 12%, and its marginal corporate tax rate is 25%.
What is the firm weighted average cost of capital : Phillips Equipment has 80,000 bonds outstanding that are selling at par. What is the firm weighted average cost of capital

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd