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JudgmentIntermediatePublished

Question · No gain or loss on issue

For an issue of convertible bonds of 600,000, whose liability component is 520,000 (case data), a trainee proposes the following entry: debit Cash 600,000; credit Debt 520,000; credit Finance income 80,000. Write a short justification stating whether this entry is acceptable, distinguishing rule, case facts and correction.

Your answer

Judgment question: compare your answer with the criteria and the model explanation.

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