Reference no: EM132774571
On June 1, 2020, Sheffield Corp. issued $8,800,000, 6% bonds for $8,625,100, which includes accrued interest. Interest is payable semiannually on February 1 and August 1 with the bonds maturing on February 1, 2030. The bonds are callable at 102.
On August 1, 2020, Sheffield paid interest on the bonds and recorded amortization. Sheffield uses straight-line amortization.
On February 1, 2022, Sheffield paid interest and recorded amortization on all of the bonds, and purchased $5,500,000 of the bonds at the call price. Assume that a reversing entry was made on January 1, 2022.
Interest Expense 282,155
Cash 264,000
Discount on Bonds Payable 18,155
Bonds Payable 5,500,000
Loss on Redemption of Bonds
Discount on Bonds Payable
Cash 5,610,000
Problem 1: Is this correct and how do find the loss on redemption amount and disc. on bonds payable?
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: On June 1, 2020, Sheffield Corp. issued $8,800,000, Is this correct and how do find the loss on redemption amount and disc. on bonds payable?
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