Answered step by step
Verified Expert Solution
Question
1 Approved Answer
On July 1, 2015, Quonk Inc. issued $1000 in principal of five-year zero coupon bonds. The company received proceeds of $650. On July 1, 2019,
On July 1, 2015, Quonk Inc. issued $1000 in principal of five-year zero coupon bonds. The company received proceeds of $650. On July 1, 2019, the carrying value of the debt was $917. On that day, the company repurchased and retired the debt for $950.
Record the journal entry for the early retirement of the debt.
- Cr. Cash -- $950
- Cr. Discount on debt payable -- $83
- Dr. Loss on early retirement of debt -- $33
- Dr. Debt payable -- $1000
- Cr. Gain on early retirement of debt -- $50
- Cr. Debt payable -- $917
- Dr. Loss on early retirement of debt -- $50
- Dr. Cash -- $917
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started