To Determine the Gain or Loss on the Retirement of Bonds

question 103

Multiple Choice

To determine the gain or loss on the retirement of bonds before their maturity date:

• A)if the carrying value of the bonds exceeds the market price of the bonds, there is a loss on retirement.
• B)if the carrying value of the bonds is less than the market price of the bonds, there is a loss on retirement.
• C)there can be no gain or loss on the retirement of the bonds.
• D)if the par value of the bonds exceeds the market price of the bonds, there is a loss on the retirement.

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