Question: i. The 10% loan note issued by UGT Plc (GHS5,000,000) is a 4- year bond issued at par on 1 January 2019. The Bonds would

i. The 10% loan note issued by UGT Plc (GHS5,000,000) is a 4- year bond issued at par on 1 January 2019. The Bonds would be redeemed on 31 December 2022 at a premium. Interests are paid annually in arrears at 31 December and the effective interest rate is thus determined as 12% per annum. The 2019 interest of GHS500,000 have been duly paid and accounted for as part of the finance costs in the statement of profit or loss.

calculate the amount to be recorded in the income statement and balance sheet for the year ended 31/12/2019.

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