A $300K bond was redeemed at 98 when the carrying value of the bond was $292K. The Journal entry for the redemption would include a: (Please provide full journal entry) A)Loss on bond redemption of $4K B)Gain on bond redemption of $4K C)Loss on bond redemption of $2K

A $300K bond was redeemed at 98 when the carrying value of the bond was $292K. The Journal entry for the redemption would include a: (Please provide full journal entry) A)Loss on bond redemption of $4K B)Gain on bond redemption of $4K C)Loss on bond redemption of $2K

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Carla Vista Co. issues $345,000, 20-year, 9% bonds at 103. Prepare the journal entry to record the…

A: Note payable: Note payable is an instrument through which borrower obtains money from lender and…

Q: A $294,000 bond was redeemed at 104 when the carrying value of the bond was $349,000. The entry to…

A: Par value of the bond = $294,000 Redemption value = $294,000 * 104% = $305.760 Carrying value of the…

Q: A $540,000 bond issue on which there is an unamortized discount of $45,000 is redeemed for $446,000.…

A: When bonds were issued on discount, company receives the face value less discount amount

Q: January 1, 2024, Nurses Credit Union (NCU) issued 7%, 20-year bonds payable with face value of…

A: The retirement of a bond is the repayment of bond at maturity. The principal is repaid and the…

Q: A $276,000 bond was redeemed at 98 when the carrying amount of the bond was $271,860. What amount of…

A: When a bond is redeemed, the difference between carrying value and redemption value.

Q: A $505,000 bond issue on which there is an unamoritizer discount of $37,000 is redeemed for…

A: As we know that the term redemption has various utilizations in the money and business world,…

Q: 2. On January 1, a company issued and sold a $409,000, 6%, 10-year bond payable, and received…

A: Face value of bonds$409,000Less: Proceed received on issuance of bonds$404,000Discount on bonds…

Q: Bonds Payable has a balance of $1,137,000 and Discount on Bonds Payable has a balance of $13,644. If…

A: Bonds: Bonds is a long-term liability of a company where it has to repay the principal amount along…

Q: On January 1, a company issued and sold a $393,000, 6%, 10-year bond payable, and received proceeds…

A: Introduction: When company issues bonds at discount, then the discount amount can be amortized over…

Q: Your answer is correct. Prepare the journal entry to record the redemption of the bonds at maturity,…

A: Gain on redemption of bonds = carrying value of bond payable + unamortized premium on Bonds payable…

Q: Bonds Payable has a balance of $802,000 and Discount on Bonds Payable has a balance of $9,624. If…

A: The objective of this question is to calculate the gain or loss on redemption of bonds. The company…

Q: A $490,000 bond issue on which there is an unamortized discount of $33,000 is redeemed for $472,000.…

A: Journal Entry: Journal entry has two effects for every transaction. The journal entry is passed by…

Q: On Janua

A: Bonds are priced by discounting future cash flows. Future cash flows include coupons and par value…

Q: On January 1, 2025, Blue Company sold 11% bonds having Prepare a schedule of interest expense and…

A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds.

Q: A $500,000 bond issue on which there is an unamortized discount of $50,000 is redeemed for $475,000.…

A: Given Information: Issue of bonds = $500,000 Unamortized discount = $50,000 Redeemed for = $475,000

Q: Bonds Payable has a balance of $880,000 and Premium on Bonds Payable has a balance of $9,680. If the…

A: Amount paid on redemption = Face value of bonds x redemption price /100 = $880,000 x 102/100 =…

Q: On December 31, a $1,000,000 bond issue on which there is an unamortized discount of $71,600 is…

A: Journal entry is the primary step to record the transaction in the books of accounts. The debit and…

Q: A $500,000 bond issue on which there is an unamortized discount of $34,000 is redeemed for $473,000.…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: A $276,000 bond was redeemed at 98 when the carrying amount of the bond was $269,100. The entry to…

A: Solution:- Introduction:- The following data given as follows:- Bond = $276,000 redeemed at = 98…

Q: balance of $1,000,000 and Discount on Bonds Payable has a balance of $10,000. If the issuing…

A: Answer : Bonds payable balance = $1,000,000 Discount on bonds payable = $10,000

Q: On January 1, 2018, Technicians Credit Union (TCU) issued 5%, 20-year bonds payable with face value…

A: Premium on Bonds Payable = Face value of Bonds - Issue price = $100000 - $100000*106% = $6000

Q: Jones Co. issued a $1,000 face amount 10-year bond and received $1,000 at the time of issuance.…

A: The bonds are the financial instruments that are issued to raise money from the market or investors.…

Q: A $288,000 bond was redeemed at 98 when the carrying amount of the bond was $280,800. The entry to…

A: Lets understand the basics. For calculating gain/loss on redemption of carrying value of bond, we…

Q: A bond has a face value of $100,000 and a price of $90,000. The journal entry at the date of…

A: Solution... Face value = $100,000 Issue price = $90,000

Q: Cucumber Electric sold $3,300,00, 8%, 10-year bonds on January 1, 2022. The bonds were dated January…

A: Under straight line method, the premium or discount is amortized with equal amounts. The bonds are…

Q: A $530,000 bond issue on which there is an unamortized discount of $37,000 is redeemed for $476,000.…

A: Bonds are the securities that are issued by the business entities or government to raise funds from…

Q: On June 1, 2021, Conundrum Company purchased at 101 a $300,000 face value bond paying 6%, with…

A: The debt is the type of securities issued by the corporation to raise funds. The company pays a…

Q: Bonds Payable has a balance of $951,000 and Discount on Bonds Payable has a balance of $11,412. If…

A: Introduction:- The following basic information as follows under:- Bonds Payable has a balance of…

Q: A $375,000 bond issue on which there is an unamortized discount of $40,000 is redeemed for $320,000.…

A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…

Q: Crane Company issued $1,730,000 of bonds on January 1, 2022. (a) Prepare the journal entry to record…

A: When bonds are redeemed at par, we will Credit Cash Account.

Q: What is the entry to record the first semiannual interest payment, and the amortization of the bond…

A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…

Q: Journalize the redemption of the bonds

A: Redemption of bond means discharging the liability of bond by paying off it in cash or cash…

Q: On January 1, a company issued and sold a $391,000, 7%, 10-year bond payable, and received proceeds…

A: Lets start with basic understanding. When bond is issued for less than its face value then it is…

Q: A $515,000 bond issue on which there is an unamortized discount of $41,000 is redeemed for $473,000.…

A: Given that: Bond value = $515000 Unamortised discount = $41000 Redemption value = $473000

Q: Campbell, Inc. produces and sells outdoor equipment. On July 1, 20Y1, Campbell issued $40,000,000 of…

A: BOND Bond is a Financial Securities which is Generally Issued by the Corporation's, Government…

Q: A $940,000 bond issue on which there is an unamortized premium of $68,000 is redeemed for $761,000.…

A: Loss on redemption of bonds = Face value of bonds + Unamortized Premium on Bonds Payable - Cash paid…

Q: Assume a $500,000 face value bond is retired early for 98% of face value. At the time of early…

A: The bonds refer to a debt instrument. It is generally issued by government entities or corporations.…

Q: A Redemption of bonds payable A $1,500,000 bond issue on which there is an unaumortized discount of…

A: All the transactions of the company that are happened during the year will be recorded first in the…

Q: A $515,000 bond issue on which there is an unamortized discount of $36,000 is redeemed for $463,000.…

A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

Q: On January 1, 2018, Lane Unlimited issues a 9%, 10- year bonds payable with a face value of…

A: Total premium on bonds = Issue value - Face value = $240,000 x 105/100 - $240,000 = $12,000

Q: Redemption of Bonds Payable A $880,000 bond issue on which there is an unamortized premium of…

A: In the given problem, the bond has been redeemed at a price less than face value. The bond payable…

Q: Prepare the statement of cash flows for the current year ended December 31 using the indirect…

A: ANSWERS. In order to determine the amount of cash created by operational operations, the indirect…

Q: On January 1, a company issued and sold a $400,000, 7%, 10-year bond payable, and received proceeds…

A: Interest expense = Interest on Bonds + Discount on bonds payable amortized = ($400,000 x 7% x 6/12)…

Question

100%

A $300K bond was redeemed at 98 when the carrying value of the bond was $292K. The Journal entry for the redemption would include a:

(Please provide full journal entry)

A)Loss on bond redemption of $4K

B)Gain on bond redemption of $4K

C)Loss on bond redemption of $2K

A $300,000 bond was redeemed at 98 when
the carrying value of the bond was
$292,000. The journal entry for the
redemption would include a

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Working:

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A $650,000 bond issue on which there is an unamortized discount of $45,00, is redeemed for $600,000. What journal entry would you make to record the redemption of the bond?
On January 1, Year 1, Sheffield Company issued bonds with a face value of $480,000, a term of ten years, and a stated interest rate of 7%. The bonds were issued at 106, and interest Sheffield uses the straight-line method amortize bond discounts and premiums. What is the carrying value of the bonds at December 31, Year 4? Multiple Choice O O OO $497,280 $480,000 $491,520 $494,400 payable each December 31.
Bonds Payable has a balance of $1,091,000 and Discount on Bonds Payable has a balance of $13,092. If the issuing corporation redeems the bonds at 98, what is the amount of gain or loss on redemption?
What is the correct choice? A $200,000 bond issue with a carrying value of $194,000 is called at 101 and retired. The entry to record the retirement of bonds is: a. Bonds Payable 200,000 Gain on Retirement of Bonds 6,000 Cash 194,000 b. Bonds Payable 200,000 Cash 200,000 c. Bonds Payable 200,000 Loss on Retirement of Bonds 8,000 Unamortised Bond Discount 6,000 Cash 202,000 d. Bonds Payable 194,000 Loss on Retirement of Bonds 8,000 Cash…
A $920,000 bond issue on which there is an unamortized premium of $65,000 is redeemed for $821,000. Journalize the redemption of the bonds. If an amount box does not require an entry, leave it blank.
A $291,000 bond was redeemed at 98 when the carrying amount of the bond was $286,635. What amount of gain or loss would be recorded as part of this transaction? Select the correct answer. loss on bond redemption of $4,365. gain on bond redemption of $5,820. gain on bond redemption of $1,455. loss on bond redemption of $1,455.
Novak corp. Issued $417,000,11% 15 year bonds on december 31,2021 for $404,490.interest is payable annually on december 31. Novak uses the straight line method to amortize bond premiums or discount. Prepare the journal entry to record the payment of interest and the discount amortization on december 31,2022
An $800,000 bond issue on which there is an unamortized premium of $57,000 is redeemed for $785,000. Journalize the redemption of the bonds. Refer to the Chart of Accounts for exact wording of account titles.
A $545,000 bond issue on which there is an unamortized discount of $37,000 is redeemed for $472,000. Journalize the redemption of the bonds.If an amount box does not require an entry, leave it blank.
Presented below is the partial bond discount amortization schedule for Pharoah Corp. Pharoah uses the effective-interest method of amortization. Interest Periods Issue date 1 2 Interest to Be Paid $117,000 117,000 Interest Expense to Be Recorded $124,981 125,380 Discount Amortization $7,981 8,380 Unamortized Discount Debit $100,383 92,402 84,022 Bond Carrying Value Credit $2,499,617 2,507,598 (a) Prepare the journal entry to record the payment of interest and the discount amortization at the end of period 1. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation 2,515,978
What account would be debited (1), what account would be credit (2), and what amount would be paid to record the journal entry for each interest payment based on a $200,000 five-year, 10% bond and the bond was issued at $192,462 (11%) and interest is paid semiannually? JOURNAL Page 25 DATE DESCRIPTION P.REF. DEBIT CREDIT (1) ? (2) ? (1) Interest Expense debit $11,000, and (2) Cash credit $11,000 (1) Interest Expense debit $10,000 and (2) Cash credit $10,000 (1) Cash debit $20,000 and (2) Interest Expense credit $20,000 (1) Cash debit $22,000, and (2) Interest Expense credit $22,000
Redemption of Bonds Payable A $880,000 bond issue on which there is an unamortized premium of $84,000 is redeemed for $823,000. Journalize the redemption of the bonds. If an amount box does not require an entry, leave it blank. 1000