Solved: On 9109 6000000 of the bond are called at 102 plus accrued, Accounting Basics

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On 9109 6000000 of the bond are called at 102 plus accrued

Question - ABC Company issues $10,000,000 face value bonds at 96 on 1/1/06. The bonds are dated 1/1/06, pay interest semi-annually at 8% on 6/30 and 12/31, and mature in 10 years. Straight-line amortization is used for discounts and premiums. On 9/1/09, $6,000,000 of the bond are called at 102 plus accrued interest. What gain or loss would be recognized on the called bonds on 9/1/09?

a. $600,000 loss

b. $272,000 loss

c. $360,000 loss

d. $453,333 loss

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Accounting Basics: On 9109 6000000 of the bond are called at 102 plus accrued

Reference No:- TGS02853484

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Accounting Basics: On 9109 6000000 of the bond are called at 102 plus accrued

Reference No:- TGS02853484

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