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Discount Pizza retires its 7% bonds for $65,000 before their scheduled maturity. At the time, the bonds have a face amount of $67,800 and a carrying value of $62,807. Record the early retirement of the bonds

Answer :

Answer:

Journal Entry

Explanation:

The Journal entry is shown below:-

Bonds payable Dr,                           $67,800

Loss on redemption of bonds Dr,    $2,193

        To Bond discount amortization              $4,993

($62,807 - $67,800)

         To Cash                                                    $65,000

(Being bonds retirement is recorded)

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