(c) Issue of bond

The club proposes to issue a 7% bond with a face value of $50 million on 1 January 2007 at a discount of 5%

that will be secured on income from future ticket sales and corporate hospitality receipts, which are approximately

$20 million per annum. Under the agreement the club cannot use the first $6 million received from corporate

hospitality sales and reserved tickets (season tickets) as this will be used to repay the bond. The money from the

bond will be used to pay for ground improvements and to pay the wages of players.

The bond will be repayable, both capital and interest, over 15 years with the first payment of $6 million due on

31 December 2007. It has an effective interest rate of 7·7%. There will be no active market for the bond and

the company does not wish to use valuation models to value the bond. (6 marks)

Required:

D．iscuss how the above proposals would be dealt with in the financial statements of Seejoy for the year ending

31 December 2007, setting out their accounting treatment and appropriateness in helping the football club’s

cash flow problems.(Candidates do not need knowledge of the football finance sector to answer this question.)

[单选题]A． impact B incident C inference D issue

[单选题]Several years ago, Simon Ma, CFA, founded an investment club with three fri

[单选题]If you leave the club, you will not be back in .A． received B. admitted C. turned D. moved

[单选题]If you leave the club, you will not be____________ back in .A． received B. admitted C. turned D. moved

[单选题]A．ccording to the passage, the issue to offer free tickets to young people seems ______.A． controversialB． inspiringC． excitingD． unreasonable

[单选题]A．ccording to the passage, the issue to offer free tickets to young people seems （ ）A． controversialB． inspiringC． excitingD． unreasonable

[单选题]The critical issue facing the scientists is to _____.［A］ apply the newly-found knowledge to the benefit of mankind［B］ end their horse race for the success of science［C］ get down to their genome research［D］ set their differences aside

[单选题]The author associates the issue of global warming with that of smoking because ________.[A] they both suffered from the government’s negligence[B] a lesson from the latter is applicable to the former[C] the outcome of the latter aggravates the former

[填空题] The auctionneres shall issue the auction announcement 7 days before the auction。（翻译）（）。

[试题]4 When a prominent football club, whose shares were listed, announced that it was to build a new stadium on landnear to its old stadium, opinion was divided. Many of the club’s fans thought it a good idea because it would be morecomfortable for them w