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Baron, Inc., issued $100,000 of its 8%, five-year bonds on January 1, 2016, at 98. Interest is paid on January 1 and July 1. The bonds are callable at 103 and straight-line amortization is used. The bonds are recalled on April 1, 2018. The journal entry to record the reacquisition of the bonds will include a a. debit to Loss on Bond Redemption for $5,000 b. credit to Gain on Bond Redemption for $5,000 c. credit to Discount on Bonds Payable for $1,100 d. debit to Loss on Bond Redemption for $4,200

Baron, Inc., issued $100,000 of its 8%, five-year bonds on January 1, 2016, at 98. Interest is paid on January 1 and July 1. The bonds are callable at 103 and straight-line amortization is used. The bonds are recalled on April 1, 2018. The journal entry to record the reacquisition of the bonds will include a a. debit to Loss on Bond Redemption for $5,000 b. credit to Gain on Bond Redemption for $5,000 c. credit to Discount on Bonds Payable for $1,100 d. debit to Loss on Bond Redemption for $4,200

FINANCIAL ACCOUNTING
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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17. Baron, Inc., issued $100,000 of its 8%, five-year bonds on January 1, 2016, at 98. Interest is paid on January 1 and July 1. The bonds are callable at 103 and straight-line amortization is used. The bonds are recalled on April 1, 2018. The journal entry to record the reacquisition of the bonds will include a


a. debit to Loss on Bond Redemption for $5,000
b. credit to Gain on Bond Redemption for $5,000
c. credit to Discount on Bonds Payable for $1,100
d. debit to Loss on Bond Redemption for $4,200

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