During the year to 30 September 2014. K co made the following payments:
1. $4,920 interest on $123,000 8% loan stock issued on 1 January 2014. Interest is payable on 30 June and 31 December.
2. $4,320 dividend on $72,000 $1 6% irredeemable preference shares.
3. $50 dividend on $1,000 5% redeemable preference shares.
What should be the finance cost in the statement of profit or loss for the year ended 30 September 2014?
Suggested solutions:
| Loan Stock | 123,000 |
| Interest for 9 months | 7,380 |
| Redeemable Preference shares | 1,000 |
| Interest for the year | 50 |
| Answer | 7,430 |