A Walt Disney annual report contained the following note:
The Company issued 100 billion (approximately $ 920 million) of Japanese yen bonds through a public offering in Japan. The bonds are senior, unsecured debt obligations of the Company, which mature in June 2019. Interest on the bonds is payable semi- annually at a fixed interest rate of 5% per year through maturity. The bonds provide for principal payments in dollars and interest payment in Japanese yen.
1. Describe how this bond would be reported on the statement of financial position.
2. Explain why you think management borrowed money in this manner.