Bonds were retired at 98% of par, or 490,000
DR Loss on retirement 50,000
DR Bonds Payable 500,000
CR Bond Discount 60,000
CR Cash 490,000
On 1/1/14 a company had bonds payable of $500,000. The unamortized discount at 1/1/14 was $60,000. On 1/1/14 the company retired all the bonds at 98.
Required:
1. What is the carrying value of the bonds at 1/1/14?
2. What is the amount of gain or loss on retirement?
Can you explain how you get the answers for above questions with the journal entries? Please~~!
Thank you so much!
