Chapter 14, Problem E14.25E

Retiring bonds payable before maturity

Parkview Magazine issued $690,000 of 15-year, 5% callable bonds payable on July 31, 2016, at 95. On July 31, 2019, Parkview called the bonds at 101. Assume annual interest.

Requirements

1. Without making journal entries, compute the carrying amount of the payable at July 31, 2019
2. Assume all amortization has been recorded properly. Journalize the retirement of the bonds on July 31, 2019. No explanation is required.