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The Really Cheap Company (RCC) issued $20 million of five-year convertible bonds at par with...

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Accounting

The Really Cheap Company (RCC) issued $20 million of five-year convertible bonds at par with 6% annual interest, which would be due December 31, 2017. The 6% bonds are convertible at any time after issuance, which was January 1, 2013, at the rate of 10 shares of common stock for each $1,000 of the face value of the convertible bonds. Issuance costs total $100,000. The current market rate for non-convertible bonds is 8% interest. What is interest expense under IFRS for year 3?

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