Accounting · Financial Instruments
Bertrand Co. issued $10 million convertible loan notes on 1 October 20X0 carrying a nominal interest (coupon) rate of 5% per annum. A similar loan note without a conversion option has an effective market interest rate of 8%. The initial liability component is calculated as $9,190,000. What is the amount that will be recognized as finance costs in the statement of profit or loss for the year ended 30 September 20X1?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$735,800
- 2$800,000
- 3$500,000
- 4$735,200✓
Correct answer
$735,200
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