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Cheyenne Corporation had bonds outstanding with a maturity value of $490,000. On April 30, 2020, when these bonds had an unamortized discount of $12,000, they

Cheyenne Corporation had bonds outstanding with a maturity value of $490,000. On April 30, 2020, when these bonds had an unamortized discount of $12,000, they were called in at 104. To pay for these bonds, Cheyenne had issued other bonds a month earlier bearing a lower interest rate. The newly issued bonds had a life of 12 years. The new bonds were issued at 103 (face value $490,000). Issue costs related to the new bonds were $3,900. All issue costs were capitalized. Cheyenne prepares financial statements in accordance with IFRS.

Ignoring interest, calculate the gain or loss and record this refunding transaction.

April 30, 2020

(To record redemption of bonds payable)

March 31, 2020

(To record issuance of new bonds)

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