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On January 1, 2020, Platz Inc. issued $700,000 of 7 percent, five-year bonds payable at 108. Platz has extra cash and wishes to retire
On January 1, 2020, Platz Inc. issued $700,000 of 7 percent, five-year bonds payable at 108. Platz has extra cash and wishes to retire all of the bonds payable on January 1, 2021, immediately after making the second semi-annual interest payment. Platz uses the straight-line method of amortization. To retire the bonds, Platz pays the market price of 97. a. What is Platz's carrying amount of the bonds payable on the retirement date? b. How much cash must Platz pay to retire the bonds payable? c. Compute Platz's gain or loss on the retirement of the bonds payable. a. What is Platz's carrying amount of the bonds payable on the retirement date? The carrying amount of the bonds payable on the retirement date is $ b. How much cash must Platz pay to retire the bonds payable? To retire the bonds Platz must pay $ c. Compute Platz's gain or loss on the retirement of the bonds payable. Platz's gain on the retirement of the bonds payable is $
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