Question
The long-term liability section of Twin Digital Corporations balance sheet as of December 31, 2017, included 12% bonds having a face amount of $30 million
The long-term liability section of Twin Digital Corporations balance sheet as of December 31, 2017, included 12% bonds having a face amount of $30 million and a remaining discount of $1 million. Disclosure notes indicate the bonds were issued to yield 14%. Interest expense is recorded at the effective interest rate and paid on January 1 and July 1 of each year. On July 1, 2018, Twin Digital retired the bonds at 102 ($30.6 million) before their scheduled maturity. Required:
1. & 2. Prepare the necessary journal entries for Twin Digital on July 1, 2018. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollar.)
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