he entry to record the redemption would include a
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
A $319,000 bond was redeemed at 104 when the carrying
a.loss on bond redemption of $12,240.
b.gain on bond redemption of $25,000.
c.loss on bond redemption of $25,000.
d.gain on bond redemption of $12,240.
Expert Solution
Correct option:
The correct option is:
d.gain on bond redemption of $12,240.
Gain on bond redemption is calculated by subtracting bonds redeemed amount from the bond's carrying value.
That is,
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