Hooper Corporation Has Bonds Outstanding with a Face Value of $100,000

question 86

Multiple Choice

Hooper Corporation has bonds outstanding with a face value of $100,000 and a carrying value of $103,000 on December 31,2010.If the company calls in and retires these bonds on December 31,2010,for $105,000,the entry to record the retirement would be:

• A)
• \(\begin{array}{lc}
• \text { Bonds Payable } & 103,000 \\
• \text { Cash } && 103,000
• \end{array}\)
• B)
• \(\begin{array}{lc}
• \text { Bonds Payable } & 105,000 \\
• \text { Cash } && 105,000
• \end{array}\)
• C)
• \(\begin{array}{l}
• \text { Bonds Payable } & 100,000 \\
• \text { Loss on Retirement of Bonds } &&3,000\\
• \quad \text { Cash }&&&103,000
• \end{array}\)
• D)
• Bonds Payable \(\quad 100,000\)
• Loss on Retirement of Bonds \(\quad 2,000\)
• Unamortized Bond Premium \(\quad 3,000\)
• Cash \(\quad \quad \quad \quad \quad \quad \quad \quad \quad \quad \quad \quad 105,000\)

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