On January 1,2020, ABC Corporation issued a 5-year, 10%, 1,000 of the P 5,000 face value bonds with a yield of 12%. The bonds is payable after five years and interests is payable annually starting December 31,2020. Assuming 1/4 of the bonds were retired at 102 on December 31,2022 after payment of periodic interest, how much is the gain or loss on retirement of the bonds? (For present value factors, do not round off)   P  67,251.28 loss P 67,251.28 gain P  269,005.10 gain P  269,005.10 loss

On January 1, 2020, Vaughn Corporation issued $5,480,000 of 10% bonds at 101 due December 31, 2029. Vaughn paid $75,000 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 105 (i.e., at 105% of face amount), and on January 2, 2025, Vaughn called one-half of the bonds and retired them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Vaughn as a result of retiring the $2,740,000 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 O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before…

On January 2, 2020, Stellar Corporation issued $1,850,000 of 10% bonds at 96 due December 31, 2029. Interest on the bonds is payable annually each December 31. The discount 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 101 (i.e., at 101% of face value), and on January 2, 2025, Stellar called $1,110,000 face value of the bonds and redeemed them. Ignoring income taxes, compute the amount of loss, if any, to be recognized by Stellar as a result of retiring the $1,110,000 of bonds in 2025. (Round answer to O decimal places, e.g. 38,548.) Loss on redemption $ Prepare the journal entry to record the redemption. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not…

On June 30, 2019, ABC acquired a non-interest bearing, 3-year, 6,000,000 face value serial bonds for 4,800,000. The principal is due every June 30. What is the interest income for the year 2020? Show solutions.