Question
On January 2, 2015, Sunland Corporation issued $1,250,000 of 10% bonds at 97 due December 31, 2024. Interest on the bonds is payable annually each
On January 2, 2015, Sunland Corporation issued $1,250,000 of 10% bonds at 97 due December 31, 2024. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable interest method.) The bonds are callable at 102 (i.e., at 102% of face amount), and on January 2, 2020, Sunland called $750,000 face amount of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Sunland as a result of retiring the $750,000 of bonds in 2020. (Round answer to 0 decimal places, e.g. 38,548.)
Loss on redemption | $enter a dollar amount of loss on redemption rounded to 0 decimal places |
Prepare the journal entry to record the redemption. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date | Account Titles and Explanation | Debit | Credit |
---|---|---|---|
January 2, 2020 | enter an account title to record the transaction on January 2, 2017 | enter a debit amount | enter a credit amount |
enter an account title to record the transaction on January 2, 2017 | enter a debit amount | enter a credit amount | |
enter an account title to record the transaction on January 2, 2017 | enter a debit amount | enter a credit amount | |
enter an account title to record the transaction on January 2, 2017 | enter a debit amount | enter a credit amount |
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