Answer:
$953
Explanation:
According IFRS the equity and Liability portion of a bond should be recorded separately at the time of bond Issuance. The Liability portion can be calculated current value of the similar non convertible bonds and the difference between the Present value of cash flows and total proceeds from bond is the equity value.
Convertible Bond are value at the present value of their cash flows.
Use following formula to calculate the value of the bond.
Value of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]
Value of the Bond = ($1,000 x 6%) x [ ( 1 - ( 1 + 6.5% )^-15 ) / 6.5% ] + [ $1,000 / ( 1 + 6.5% )^15 ]
Value of the Bond = $952.99
