If the company retired these bonds at a call price of 99, the gain or loss on this retirement is?
Answers: Book convenience is face pro + unamortized premium, so
Book value = $100,000 + $2,700 = $102,700
If the bonds be retired at 99, cash giving is $99,000 so the gain is $3,700.
Journal entry:
Dr Bonds payable $100,000
Dr Bonds premium $2,700
Cr Cash $99,000
Cr Gain on bonds redemption $3,700
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Answers: Book convenience is face pro + unamortized premium, so
Book value = $100,000 + $2,700 = $102,700
If the bonds be retired at 99, cash giving is $99,000 so the gain is $3,700.
Journal entry:
Dr Bonds payable $100,000
Dr Bonds premium $2,700
Cr Cash $99,000
Cr Gain on bonds redemption $3,700
Resolved Questions: