If There Is a Loss on Bonds Redeemed Early, It

question 37

Multiple Choice

If there is a loss on bonds redeemed early, it is

• A)debited directly to Retained Earnings.
• B)reported as "Other Expenses and Losses" on the income statement.
• C)reported as part of profit from operations on the income statement.
• D)debited to Interest Expense, as a cost of financing.

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Definitions:

Note Discounted

A financial term referring to a note that is sold for less than its face value before its maturity, usually to improve liquidity.

Goods Sold

Refers to the total value or quantity of products that have been sold or exchanged for money or other value, typically within a specific timeframe.

Interest Rate

The amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Operating Segment

A component of a business for which discrete financial information is available and is regularly reviewed by the entity's chief operating decision maker for performance assessment and resource allocation.