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On January 2, 2020, Wildhorse Corporation issued $1,050,000 of 10% bonds at 97 due December 31, 2029. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method.") The bonds are callable at 102 (i.e., at 102% of face value), and on January 2, 2025, Wildhorse called $630,000 face value of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Wildhorse as a result of retiring the $630,000 of bonds in 2025. (Round answer to O decimal places, e.g. 38,548.) Loss on redemption $ Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)

On January 2, 2020, Wildhorse Corporation issued $1,050,000 of 10% bonds at 97 due December 31, 2029. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method.") The bonds are callable at 102 (i.e., at 102% of face value), and on January 2, 2025, Wildhorse called $630,000 face value of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Wildhorse as a result of retiring the $630,000 of bonds in 2025. (Round answer to O decimal places, e.g. 38,548.) Loss on redemption $ Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 16E
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On January 2, 2020, Wildhorse Corporation issued $1,050,000 of 10% bonds at 97 due December 31, 2029. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method.") The bonds are callable at 102 (i.e., at 102% of face value), and on January 2, 2025, Wildhorse called $630,000 face value of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Wildhorse as a result of retiring the $630,000 of bonds in 2025. (Round answer to O decimal places, e.g. 38,548.) Loss on redemption $ Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Transcribed Image Text:On January 2, 2020, Wildhorse Corporation issued $1,050,000 of 10% bonds at 97 due December 31, 2029. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method.") The bonds are callable at 102 (i.e., at 102% of face value), and on January 2, 2025, Wildhorse called $630,000 face value of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Wildhorse as a result of retiring the $630,000 of bonds in 2025. (Round answer to O decimal places, e.g. 38,548.) Loss on redemption $ Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
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