Tyrell Company issued callable bonds with a par value of $40,000. The call option requires Tyrell to pay a call premium of $500 plus par (or a total of $40,500) to bondholders to retire the bonds. On July 1, Tyrell exercises the call option. The call option is exercised after the semiannual interest is paid the day before on June 30. Record the entry to retire the bonds under each separate situation. 1. The bonds have a carrying value of $31,500. 2. The bonds have a carrying value of $41,000. View transaction list View journal entry worksheet No Credit Date July 01 Debit 40,000 General Journal Bonds payable Loss on Retirement of Bonds Cash Gain on Retirement of Bonds 40,500 2 2 July 01 Bonds payable Premium on bonds payable Cash Gain on Retirement of Bonds