Presented below are two independent situations.
1. Longbine plc redeemed £130,000 face value, 12% bonds on June 30, 2017, at 102. The carrying value of the bonds at the redemption date was £117,500. The bonds pay annual interest, and the interest payment due on June 30, 2017, has been made and recorded.
2. Tastove Ltd. redeemed £150,000 face value, 12.5% bonds on June 30, 2017, at 98. The carrying value of the bonds at the redemption date was £151,000. The bonds pay annual interest, and the interest payment due on June 30, 2017, has been made and recorded.
Instructions
Prepare the appropriate journal entry for the redemption of the bonds in each situation.