Question: Question 3 (15 Marks) Part A (7 Marks) On 1 July 2019, Fancy Ltd raised debt finance via an issue of 1000 five-year bonds at

Question 3 (15 Marks) Part A (7 Marks) On 1 July 2019, Fancy Ltd raised debt finance via an issue of 1000 five-year bonds at $1000 cach with a coupon interest rate of 6 per cent per annum, payable annually in arrears. At the time of the bond issued, the market interest rate for equivalent risk bonds was 10 per cent. Required: a) Calculate the issue price of the bond issue. (1.5 Marks) b) Calculate the amortised cost of the bonds payable account as at 30 June 2020 to 30 June 2024 (2.5 Marks) c) Prepare the journal entries to issue the coupon bonds on 1 July 2019 and the entries on 30 June 2020 and 30 June 2021 to record the interest paid (3 Marks) Part B (8 Marks) Emerald Pty Ltd an Australian wine company based in South Australia entered a contractual arrangement with Demzat Ltd, a British company. Demzat Ltd is a robotic manufacturer and they are to build a specialized bottle filter that is capable of filling 2,500 wine of 750 ml bottles per minute. The relevant events and the spot rates at each date are shown as follows: Date Event Spot rate 15 November 2020 11 June 2021 30 June 2021 15 July 2021 Emerald Pty Ltd ordered bottle filler 300 000 A$1.00 - 37p Purchase takes place as bottle filler is shipped A$1.00 = 41p to Emerald Pty Ltd (FOB) End of financial year A$1.00 = 43p Installed and ready for use A$1.00 -42p Payment of 300 000 to Demzat Ltd is made A$1.00 = 39p 11 August 2021 Required: Prepare appropriate journal entries for each relevant event

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