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QUESTION $5$

Entity A is listed in Hong Kong. It is a toy manufacturer which commenced its business more than thirty years ago.

July $2020.$ Fixed interest is received in arrears. The bond will be redeemed at par or premium or discount over its face value on $30$ June $2023.$

The fair values of the bond were as follows:

appear to sign the contract on $31$ December $2022.$

Finally, Entity A could not find any new buyers and it held the bond untli maturity.

The effective interest rate is $7\mathrm{.}75\%.$ The market environment is stable and credit risk$-$free. The end of the reporting period is $30$ June.

REQUIRED:

According to relevant accounting standards, prepare journal entries to recognise the transactions of Entity A from $1$ July $2020$ to $30$ June $2023.$

ACCOUNTS FOR INPUT:

$|$ Financial asset $($Amortised Cost$)|$ Financial asset $($FVTPL$)|$ Financial asset $($FVTOCI$)|$

$|$ Financial liablilty $|$ Equity instrument $|$ Transaction cost $|$ Bank $|$ Loss allowance $|$ Impaiment loss $|$ Reversal of impairment loss $|$

$|$ Gain on remeasurement $($P$/$L$)|$ Loss on remeasurement $($P$/$L$)|$ Gain on remeasurement $($OCl$)|$ Loss on remeasurement $($OCl$)|$

$|$ Payable $|$ Recelvable $|$ Other income $|$ Other expense $|$ Reclassification $($P$/$L$)|$ Reclassification $($OCI$)|$

$|$ Interest expense $|$ Interest revenue $|$ Loss on disposal $|$ Gain on disposal $|$ Retained earnings $|$ No entry $|$

ANSWERS:

Journal Entries:Date

Account Name

Debit $($$$$)$

Credit $($$$)$

Hints For Sequence

$1-$Jul$-20$

$16-$Jul$-20$

$30-$Jun$-21$

$30-$ Jun$-21$

$30-$ Jun$-22$

$30-$Jun$-22$

$30-$ Jun$-23$

$30-$Jun$-23$

$30-$ Jun$-23$

$30-$Jun$-23$

Non$-$Asset. Judge DriCr.

Judge Dr$/$Cr$.$

Non$-$Income. Judge Dr$/$Cr$.$

Non$-$Income. Judge Dr$/$Cr$.$

Not$-$Income. Judge DriCr.

Not$-$Asset. Judge Dr$/$Cr$.$

Judge DriCr.

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