A $100,000 Bond Issue with a Carrying Value of $103,000

question 72

Multiple Choice

A $100,000 bond issue with a carrying value of $103,000 is called at 101 and retired.The entry to record the retirement of bonds would be:

• A)
• \(\begin{array} { l c l }
• \text { Bonds Payable } & 101,000 & \\
• \text { Loss on Retirement of Bonds } && 2,000 \\
• \quad \text { Cash } & && 103,000
• \end{array}\)
• B)
• Bonds Payable \(\quad 100,000\)
• Unamortized Bond Premium \(\quad 3,000\)
• \(\begin{array} { l c } \text { Cash } & 101,000 \\ \text { Gain on Retirement of Bonds } & 2,000 \end{array}\)
• C)
• \(\begin{array}{lll}
• \text { Bonds Payable } & 100,000 & \\
• \text { Loss on Retirement of Bonds } & & 3,000 \\
• \quad \text { Cash } & & & 103,000 \\
• \end{array}\)
• D)
• \(\begin{array}{ll}
• \text { Bonds Payable } & 103,000 \\
• \text { Cash } &&103,000
• \end{array}\)

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