On September 30, 2012, Blossom Company issued 9% bonds with a par value of $470,000 due in 20 years. They were issued at 98 and were callable at 105 at any date after September 30, 2017. Because Blossom Company was able to obtain financing at lower rates, it decided to call the entire issue on September 30, 2018, and to issue new bonds. New 8% bonds were sold in the amount of $740,000 at 103; they mature in 20 years. Blossom Company uses straight-line amortization. Interest payment dates are March 31 and September 30. Prepare journal entries to record the redemption of the old issue and the sale of the new issue on September 30, 2018. Debit credit Bonds Payable Loss on Redemption Discount on Bonds Payable Cash

Cash Premium on Bonds Payable Bonds Payable