Exercise 14-15

Pearl Company had bonds outstanding with a maturity value of $318,000. On April 30, 2017, when these bonds had an unamortized discount of $9,000, they were called in at 104. To pay for these bonds, Pearl had issued other bonds a month earlier bearing a lower interest rate. The newly issued bonds had a life of 10 years. The new bonds were issued at 103 (face value $318,000). Ignoring interest, compute the gain or loss.

Loss on redemption Ignoring interest, record this refunding transaction. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit To record redemption of bonds payable) To record issuance of new bonds)