In fiscal 2014, Ruthilda Inc. (Ruthilda) decided to exercise its option to redeem its outstanding bond issue
Question:
In fiscal 2014, Ruthilda Inc. (Ruthilda) decided to exercise its option to redeem its outstanding bond issue before the maturity date in 2021. The bonds had a face value of $25,000,000 and Ruthilda paid $25,750,000 to redeem them. The bonds were originally issued at a premium of $1,500,000 and at the time the bonds were redeemed, $900,000 of the premium had been amortized.
Required a Prepare the journal entry to record the early retirement of the bonds.
b. What would be the entry if Ruthilda was able to redeem the bonds on the open market at 2 cost of $23,500,100
c. What is the economic significance of a gain or loss on the redemption of bonds? How do you think the gain or loss should be reported in the financial statements? Explain. In responding, consider the information needs of the stakeholders.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (QA)
Answered By
Mwangi Clement
I am a tried and tested custom essay writer with over five years of excellent essay writing. In my years as a custom essay writer, I have completed more than 2,000 custom essays in a diverse set of subjects. When you order essays from me, you are working with one of the best paper writers on the web. One of the most common questions I get from customers is: “can you write my essay?” Upon hearing that request, my goal is to provide the best essays and overall essay help available on the web. I have worked on papers in subjects such as Nursing and Healthcare, English Literature, Sociology, Philosophy, Psychology, Education, Religious Studies, Business, Biological Sciences, Communications and Media, Physical Sciences, Marketing and many others. In these fields, my specialties lie in crafting professional standard custom writings. These include, but are not limited to: research papers, coursework, assignments, term papers, capstone papers, reviews, summaries, critiques, proofreading and editing, and any other college essays.
My extensive custom writings experience has equipped me with a set of skills, research abilities and a broad knowledge base that allows me to navigate diverse paper requirements while keeping my promise of quality. Furthermore, I have also garnered excellent mastery of paper formatting, grammar, and other relevant elements. When a customer asks me to write their essay, I will do my best to provide the best essay writing service possible. I have satisfactorily offered my essay writing services for High School, Diploma, Bachelors, Masters and Ph.D. clients.
I believe quality, affordability, flexibility, and punctuality are the principal reasons as to why I have risen among the best writers on this platform. I deliver 100% original papers that pass all plagiarism check tests (Turnitin, Copyscape, etc.). My rates for all papers are relatively affordable to ensure my clients get quality essay writing services at reasonable prices.
