Reference no: EM132993044
Question - Use the following information for the next four items: On January 1, 2019, Void Company issued 2,000 of its 5-year, P1,000 face value, 11% bonds dated January 1 at an effective annual interest rate (yield) of 9%. Interest is payable each December 31. Void uses the effective-interest method of amortization. On December 31, 2020, the 2,000 bonds were called in at the call price of 99 plus accrued interest.
Note: Round off present value factors to four decimal places (X.XXXX).
Based on the information above, answer the following:
1. How much is the premium or discount on bonds payable on the date of issuance?
2. How much is the adjustment on the premium or discount on bonds payable on December 31, 2020??
3. How much is the gain or loss on bond retirement on December 31, 2020?
4. How much is the total cash paid for the retirement of the bonds?
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