Question: A 5 % loan note was issued on 1 st April 2 0 2 0 at its face value of 4 0 million. Direct costs

A 5% loan note was issued on 1st April 2020 at its face value of 40 million.
Direct costs of the issue were 2,000,000. The loan note will be redeemed on
31st March 2023 at a substantial premium. The effective interest rate applicable
is 10% per annum. At what amount will the loan note appear in the statement of
financial position as at 31st March 2022?
A.39,800
B.41,780
C.39,780
D.43,780

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