Grouper Corp. issued $456,000 of 14-year bonds at a discount. Prior to maturity, when the carrying...
Grouper Corp. issued $456,000 of 14-year bonds at a discount.
Prior to maturity, when the carrying value of the bonds was
$442,320, the company redeemed the bonds at 99.
Prepare the entry to record the redemption of the bonds.
Homework Answers
| Journal | Debit | Credit |
| Bonds Payable | $456000 | |
| Loss on retirement of bonds | $9120 | |
| to Cash | $451440 | |
| to Discount on bonds | $13680 |
- Carrying amount of bond payable is $442320 and company redeemed the binds at 99 means ($456000 *99% = $451440) so loss has to be recognized for the difference amount $451440 - $442320 = $9120
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