AccountingBonds Payable has a balance of $957,000 andDiscount on Bonds Payable has a balance of$9,570. If the issuing corporation redeems thebonds at 97.5, what is the amount of gain or losson redemption?a. $14,355 lossb. $9,570 gainc. $14,355 gaind. $9,570 loss

Where Bonds are issued at a price lower than it's face value, there arises a discount/loss on issue.…

Answered: Accounting Bonds Payable has a balance…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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5. Compute the price of $94,580,761 received for the bonds by using the tables shown in Present Value Tables. (Round to the nearest dollar.) Present value of the face amount Present value of the semiannual interest payments Price received for the bonds
Answer full question.
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A $1,000,000 bond issue on which there is an unamortized premium of $71,600 is redeemed for $1,051,500. Journalize the redemption of the bonds. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes Receivable 131 Merchandise Inventory 141 Office Supplies 191 Land 194 Office Equipment 195 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 221 Salaries Payable 231 Sales Tax Payable 232 Interest Payable 241 Notes Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid-In Capital in Excess of Par-Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331…
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(a) Prepare the journal entry to issue $500,000 bonds that sold for $470,000. (b) Prepare the journal entry to issue $500,000 bonds that sold for $518,000.

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Accounting Bonds Payable has a balance of $957,000 and Discount on Bonds Payable has a balance of $9,570. If the issuing corporation redeems the bonds at 97.5, what is the amount of gain or loss on redemption?