Exercise 121

Prepare journal entries to record the following retirement. (show computations and round to the nearest dollar)

The December 31, 2018 balance sheet of Wolfe Co. included the following items:

7.5% bonds payable due December 31, 2026 $3,000,000

Unamortized discount on bonds payable $120,000

The bonds were issued on December 31, 2016 at 95, with interest payable on June 30 and December 31. (Use straight-line amortization.)

On April 1, 2019, Wolfe retired $600,000 of these bonds at 101 plus accrued interest.