Purchase price in consolidated financial-statements

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Reference no: EM13146927

On January 1, 2009, Riley Corp. acquired some of the outstanding bonds of one of its subsidiaries. The bonds had a carrying value of $421,620 and Riley paid $401,937 for them. How should you account for the difference between the carrying value and the purchase price in the consolidated financial statements for 2009?

• The difference is added to the carrying value of the debt

• The difference is deducted from the carrying value of the debt

• The difference is treated as a loss from the extinguishment of the debt

• The difference is treated as a gain from the extinguishment of the debt

• The difference does not influence the consolidated financial statements

Reference no: EM13146927

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