Extinguishment of debt problem

Assignment Help Accounting Basics
Reference no: EM13145338

On January 1, 2006, Goll Corp. issued 1,000 of its 10%, $1,000 bonds for $1,040,000. These bonds were to mature on January 1, 2016, but were callable at 101 any time after December 31, 2009. Interest was payable semiannually on July 1 and January 1. On July 1, 2011, Goll called all of the bonds and retired them. Bond premium was amortized on a straight-line basis. Before income taxes, Goll's gain or loss in 2011 on this early extinguishment of debt was:

a) $30,000 gain.

b) $12,000 gain.

c) $10,000 loss.

d) $8,000 gain.

Reference no: EM13145338

Questions Cloud

Find the margin of error for the confidence interval : Find the margin of error for the 95% confidence interval used to estimate the population proportion. In a survey of 7100 T.V. viewers.
Net revenue approach to revenue recongnition : Explain the net revenue approach to revenue recongnition employed in general fund and special revenue fund (and other governmental fund) accounting and reporting, including why it is used.
Explain whether you agree or disagree with court decision : The joint bankruptcy filing of GGP and most of its SPEs has apparently allowed GGP to successfully reorganize much of its debt and repay all of its obligations, while retaining substantial value for its equity holders. Explain whether you agree or..
What two types of crosses between true-breeding strains : Based on this information, explain the pattern of inheritance. Be sure to include the genotypes of the green parents and all four phenotypic classes, as well as the fraction of the total progeny that each phenotypic class represents in your answer..
Extinguishment of debt problem : Interest was payable semiannually on July 1 and January 1. On July 1, 2011, Goll called all of the bonds and retired them. Bond premium was amortized on a straight-line basis. Before income taxes, Goll's gain or loss in 2011 on this early extingui..
Determining fixed costs of bigelow industries : Bigelow Industries manufactures swim caps. Their operating leverage is 3. Each cap sells for $10 and has a contribution margin of $6. They expect to sell 37,500 swim caps. Their fixed costs are:
Compute the molal concentration of cacl : a solution is prepared by dissolving 23.7g of CaCl2 in 375g of water. The density of the resulting solution is 1.05g/mL.
Draw to scale a histogram and frequency polygon : Using the stem and leaf technique, construct a less-than cumulative frequency distribution. -Draw to scale a histogram, frequency polygon and less-than cumulative ogive using the information from 1.
How many dresses must the bridal shoppe sell to yield : The average selling price of each dress is $1,000, variable costs are $400, and fixed costs are $90,000. How many dresses must the Bridal Shoppe sell to yield after-tax net income of $18,000, assuming the tax rate is 40%?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Gain or loss-basis in new property

Determine Debbie's and Elizabeth's realized gain or loss, recognized gain or loss, and the basis in their new property.

  Amount of loss accrual

Espinosa Co. has a loss contingency to accrue. The loss amount can only be reasonably estimated within a range of outcomes. No single amount within the range is a better estimate than any other amount. The amount of loss accrual should be:

  Explain how the cash budget can impact the timing

Also explain how the cash budget can impact the timing of certain decisions such as when to invest in capital projects or seek additional financing.

  Amount budgeted for the month

Andrea's Hobbies produces and sells a luxury animal pillow for $40.00 per unit. In the first month of operation, 3,000 units were produced and 2,250 units were sold. Actual fixed costs are the same as the amount budgeted for the month. Other infor..

  Information about financial math

Your required a rate of return is 4%. What is the value of a contract that pays the buyer $100 a year forever (the first payment is made exactly one year after purchase) plus an additional $1000 a year for the first 10 years

  Advantage of the discount

What is the amount of the discount, and up to what date must the invoice be paid in order for the buyer to take advantage of the discount?

  How should clyde treat payment on his 2010 tax return

This is a tax research problem - Clyde had work for many years as the chief executive of Red Industries, and had also been a major shareholder. Clyde and the company had a falling out, and Clyde was terminated.

  Earnings available for dividends

Cash of $2,000 had been set aside for the plant expansion. How much of retained earnings is available for dividends?

  Statement of cash flows problem

If a gain of $18,000 is incurred in selling (for cash) office equipment having a book value of $120,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is:

  Change in accounting estimate

Which of the following should be reported as a change in accounting estimate?

  Calculation of bond current price

Jackson Corporations have 12 years remaining to maturity. Interest is paid annually, the bonds have a $1000 par value and the coupon interest rate is 8%. The bonds have a yield to maturity of 9%.

  Problem on inventory acquisitions

-All sales are on credit. -Customer amounts on account are collected 50% in the month sale and 50% in the following month.  -Cost of goods sold is 35% of sales.  -Farley purchases and pays for merchandise 60% in the month of acquisition and 40% in th..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd