QUESTION

How do I obtain the carrying amount of bonds payable

Loss On retirement of Bonds Payable

And Discount on bonds payable?

Seaview Magazine $390,000 of 15-year, 8% callable bonds payable on July 31,

20182018, at 99. On July 31, 2021 Seaview called the bonds at

102.

Assume annual interest payments.

Requirements

1.	Without making journal entries, compute the carrying amount of the bonds payable at July 31, 2021
2.	Assume all amortization has been recorded properly. Journalize the retirement of the bonds on July 31, 2021 No explanation is required.

Requirement 1. Without making journal entries, compute the carrying amount of the bonds payable at July 31,

20212021.

(Assume bonds payable are amortized using thestraight-line amortization method.)

First, complete the sentence below.

The carrying amount of the bonds payable at issuance (July 31, 2018) is $			386,100		. The	discount			on the bonds at
issuance amounts to $	3,900	.
The carrying amount of the bonds payable at July 31, 2021 is $				386,880			.

Requirement 2. Assume all amortization has been recorded properly. Journalize the retirement of the bonds on July 31,

20212021.

No explanation is required. (Record debits first, then credits. Exclude explanations from any journal entries.)

Date			Accounts	Debit	Credit
2021
Jul. 31			Bonds Payable	390,000
			Loss on Retirement of Bonds Payable	10,920
			Cash		397,800
			Discount on Bonds Payable		3,120