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Balboa Corporation issued $1,500,000 of 11% bonds at 97 on January 2, 2019. Interest is paid semiannually on June 30 and December 31. The bonds
Balboa Corporation issued $1,500,000 of 11% bonds at 97 on January 2, 2019. Interest is paid semiannually on June 30 and December 31. The bonds had a 10-year life from the date of issue, and the company uses the straight-line method of amortization. On April 30, 2021, Balboa recalls the bonds at the call price of 105 plus accrued interest. Journal entries for 2021 would include: a credit to Discount on Bonds Payable of $1,125 a credit to Discount on Bonds Payable of $36,000 a credit to Cash of $1,575,000 a debit to Loss of $109,500
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