Ervay Company Has $875,000 of Bonds Outstanding

question 256

Multiple Choice

Ervay Company has $875,000 of bonds outstanding. The unamortized premium is $12,600. If the company redeemed the bonds at 101, what would be the gain or loss on the redemption?

• A) $3,850 gain
• B) $3,850 loss
• C) $8,750 gain
• D) $8,750 loss

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