t Exerc Book Redemptlon of Bonds Issued at a Discount Mutschelknaus Manufacturin

Question

t Exerc Book Redemptlon of Bonds Issued at a Discount Mutschelknaus Manufacturing sold bonds at a discount for $404,800 (discount of $10,800) seven years ago. a. The corporation redeems $24,000 of this issue at 97. The unamortized discount is $310. b. The corporation redeems $30,500 or this issue at 99·The unamortized discount is $480. Prepare journal entries to recore the redemption in (a) and (b). If an amount box does not require an entry, leave it blank. Page: 1 DOC. POST. DEBIT CREDIT NO. REF DATE ACCOUN???LE 1 a. 6 b.

Explanation / Answer

Journal entries: Date Accounts title and explanations Deit $ Crredit $ a. Bonds payable Dr. 24000       Gain on retirement of bonds       Discounts on Bonds payable 310       Cash Account 23280 b. Bonds payable Dr. 30500 Loss on retirement of bonds 175       Discounts on Bonds payable 480       Cash Account 30195

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