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This case explores the accounting for long-term debt from the perspective of the issuer of bonds payable. The global setting involving France-based Renault issuing Chinese yuan-denominated debt in the offshore markets (ie, 'dim sum bonds') provides significant opportunity for secondary learning. The accounting could be undertaken from the perspective of US GAAP or IFRS (ie, the standards are identical for the principal transaction and events considered in this case, with the exception of hypothetical discussions related to the fair value option for debt available under SFAS 157 in US GAAP). The case requires students to account for the issuance of bonds offered at a discount, to implement the effective interest method for several periods, to calculate the amount of interest expense that will be charged to the income statement over the life of the discounted bonds (ie, to understand the economic rationale behind the prescribed effective interest rate method), to understand the income statement implications of early debt extinguishments and the transaction entries associated with these transactions, and to consider the implications of the fair value method had the issuer made this election.