Question
On its December 31, 2010 balance sheet, Emig Corp. reported bonds payable of $6,000,000. The bonds had been issued at par. On January 1, 2011,
On its December 31, 2010 balance sheet, Emig Corp. reported bonds payable of $6,000,000. The bonds had been issued at par. On January 1, 2011, Emig retired $3,000,000 of the outstanding bonds at par plus a call premium of $70,000. What amount should Emig report in its 2011 income statement as loss on extinguishment of debt (ignore taxes)?
| $0 | ||
| $70,000 | ||
| $160,000 | ||
| $230,000 |
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Information For Decision Making Readings In Cost And Managerial Accounting
Authors: Alfred Rappaport
3rd Edition
0134643542, 978-0134643540
