Question: The situations presented here are independent of each other.
Instructions: For each situation, prepare the appropriate journal entry for the redemption of the bonds.
(a) Mikhail Corporation redeemed $140,000 face value, 9% bonds on April 30, 2017, at 101. The carrying value of the bonds at the redemption date was $126,500. The bonds pay annual interest, and the interest payment due on April 30, 2017, has been made and recorded.
(b) Oldman, Inc., redeemed $170,000 face value, 12.5% bonds on June 30, 2017, at 98. The carrying value of the bonds at the redemption date was $184,000. The bonds pay annual interest, and the interest payment due on June 30, 2017, has been made and recorded.