Goethe Corporation redeems its ($ 100,000) face value bonds at 105 on January 1, following the payment

Question:

Goethe Corporation redeems its \(\$ 100,000\) face value bonds at 105 on January 1, following the payment of interest. The carrying value of the bonds at the redemption date is \(\$ 103,745\). The entry to record the redemption will include a:

a. credit of \(\$ 3,745\) to Loss on Bond Redemption.

b. debit of \(\$ 3,745\) to Premium on Bonds Payable.

c. credit of \(\$ 1,255\) to Gain on Bond Redemption.

d. debit of \(\$ 5,000\) to Premium on Bonds Payable.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Accounting Tools For Business Decision Making

ISBN: 9781119191674

6th Edition

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

Question Posted: