Response to the following questions:
1. On June 1, LeMond Company recalls bonds with a face value of $200,000 and a current book value of $190,000. LeMond pays $192,000 to retire the bonds. Prepare the journal entry to record the retirement of the bonds.
2. Love & Co. issues bonds with a face value of $50,000 for $51,000. Each $1,000 bond carries 10 warrants, and each warrant allows the holder to acquire one share of $1 par common stock for $40 per share. Immediately after the issuance, the bonds are quoted at 99 ex rights and the warrants are quoted at $5 each. Calculate the value to be assigned to the bonds and to the warrants.