Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. on january 1,2020, ayayai corporation issued $5,18

On January 1,2020, Ayayai Corporation issued $5,180,000 of 10% bonds at 102 due December 31,2029....

60.1K

Verified Solution

Question

Accounting

On January 1,2020, Ayayai Corporation issued $5,180,000 of 10% bonds at 102 due December 31,2029. Ayayai paid $74,000 in bond issue costs when the bonds were issue to the market. These will be amortized over the life of the bond. The premium on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable "interest method".)
The bonds are callable at 106(i.e., at 106% of face amount), and on January 2,2025, Ayayai called one-half of the bonds and retired them.
Ignoring income taxes, compute the amount of loss, if any, to be recognized by Ayayai as a result of retiring the $2,590,000 of bonds in 2025.
Loss on redemption $
Prepare the journal entry to record the retirement. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
\table[[Date,Account Titles and Explanation],[January 2,,Bonds Payable],[2025,]]
Debit
Credit
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Biology
1.2K views

Which statement about biomes is true?A. Different biomes share similar plants and wildlife.B.Each biome has...

Statistics
1.2K views

Almost all employees working for financial companies in New York City receive large bonuses at the...

Medical Sciences
1.2K views

1. The Endocrine System a. Give an example of the negative feedback relationship between the hypothalamus, anterior...

Biology
1.2K views

1. You cross a true-breeding parental with yellow flowers and oval petals with a true-breeding parental...

Mechanical Engineering
1.2K views

How does polymeric glass formation prevent flow of linear polymer? Explain Tg and chemical reasons. How...

Biology
1.2K views

Sanger sequencing uses which of the following to determine the nucleotide sequence by terminating replication...

Physics
1.2K views

a A resistor has colour band sequence Orange Violet orange gold and another resistor Orange...

Physics
1.2K views

25 180 In circular motion The centripetal acceleration is Due to change in magnitude of...

Calculus
1.2K views

If f x sin 5x 2 then f x Note The inverse of sin z...

Accounting
1.2K views

Crane Company wants to produce and sell a new flavored water. In order to penetrate...

Accounting
1.2K views

Alva Incorporated produces and sells B4T8, a component used in a multitude of consumer electronics....

Accounting
1.2K views

88 ill. As a media buyer for the Walker Agency, Rick knows that no one...