Critical Thinking 15-05 a-b On January 1, 2018, Oriole Corporation issued $2,970,000 of 5-year, 7% bonds at 99. The bonds pay interest annually on January 1. By January 1, 2020, the market rate of interest for bonds of risk similar to those of Oriole Corporation had risen. As these bonds was $2,350,000 on January 1, 2020-below their carrying value. Joanna Oriole, president of the company, suggests repurchasing all of these bonds in the open market at the $2,350,000 price. To do so, the company will have to issue $2,350,000 (face value) of new 10- year, 12% bonds at par. The president asks you, as controller, "What is the feasibility of my proposed repurchase plan?" result, the market value of Answer the following. x Your answer is incorrect. Try again. What is the carrying value of the outstanding Oriole Corporation 5-year bonds on January 1, 2020? (Assume straight-line amortization.) Carrying value of bonds 2946240 Prepare the journal entry to redeem the 5-year bonds on January 1, 2020. Prepare the journal entry to issue the new 10-year bonds. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Credit No. Account Titles and Explanation Debit 1. Bonds Payable 2970000 Discount on Bonds Payable 23760 Gain on Bond Redemption 596240 Cash 2350000 (To record redemption of bonds) 2. Cash 2350000 Bonds Payable 2350000 (To record sale of bonds at par)