A Company Has Bonds Outstanding with a Face Value of $100,000.The

question 70

Multiple Choice

A company has bonds outstanding with a face value of $100,000.The unamortized premium on these bonds is $2,700.If the company retired these bonds at a call price of 99,the journal entry to record this retirement includes a debit to:

• A)Bonds Payable for $100,000,a debit to Premium on Bonds Payable for $2,700,a credit to Cash for $99,000,and a credit to Gain on Bond Retirement for $3,700.
• B)Bonds Payable for $100,000,a debit to Loss on Bond Retirement for $1,700,a credit to Cash for $99,000,and a credit to Premium on Bonds Payable for $2,700.
• C)Bonds Payable for $100,000,credit to Cash for $99,000,and a credit to Gain on Bond Retirement for $1,000.
• D)Bonds Payable for $100,000,a debit to Loss on Bond Retirement for $1,673,and a credit to Cash for $101,673.

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Definitions:

Diatomic Elements

Molecules composed of only two atoms, of the same or different chemical elements.

Atoms

The basic units of matter and the defining structure of elements, consisting of a nucleus surrounded by electrons.

Systematic Name

A name given to compounds as per the rules determined by the International Union of Pure and Applied Chemistry (IUPAC).