State carrying amount of the debentures in balance sheet

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The 6% Rs 20,000 debentures were issued on 1st July 2015 at a discount of 10%. Issue costs amounted to Rs 1,000. The debentures will be redeemed at a premium of Rs 1015 above par value. Interest payments (equivalent to 6% of Rs 20000) are effected every 30 June. The effective rate of interest is 12% per annum. The discount of Rs 2000 on issue together with the issue costs have been included in administrative expenses.

Required:

Question 1: State the carrying amount of the debentures in the balance sheet at 30 June 2016 and explain whether this figure is correct.

Question 2: Using the provisions of IFRS 9, state the revised carrying amount of the 6% Debentures at 30 June 2016.

Reference no: EM132525875

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