Lopez Plastics Co. (LPC) issued callable bonds on January 1, 2021. LPC's accountant has projected the following amortization schedule from issuance until maturity: Cash Effective Decrease in Outstanding Date interest interest balance balance 1/1/2021 $ 207,020 6/30/2021 $ 7,000 24 6,211 24 789 206,230 12/31/2021 7,000 6,187 813 205,417 6/30/2022 7,000 6,163 837 204,580 12/31/2022 7,000 ? ..(omitted) 12/31/2024 200,000 LPC calls the bonds at 105 immediately after the interest payment on 12/31/2022 and retires them. What gain or loss, if any, would LPC record on this date?

Lopez Plastics Co. (LPC) issued callable bonds on January 1, 2021. LPC's accountant has projected the following amortization schedule from issuance until maturity: Cash Effective Decrease in Outstanding Date interest interest balance balance 1/1/2021 $ 207,020 6/30/2021 $ 7,000 24 6,211 24 789 206,230 12/31/2021 7,000 6,187 813 205,417 6/30/2022 7,000 6,163 837 204,580 12/31/2022 7,000 ? ..(omitted) 12/31/2024 200,000 LPC calls the bonds at 105 immediately after the interest payment on 12/31/2022 and retires them. What gain or loss, if any, would LPC record on this date?

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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