Recognizing the redemption of bonds


On January 1, 2014, Danny Co. redeemed its 15-year bonds of $3,500,000 par value for 102. They were originally issued on January 1, 2002 at 98 with a maturity date of January 1, 2017. The bond issue costs relating to this transaction were $210,000. Danny amortizes discounts, premiums, and bond issue costs using the straight-line method. What amount of loss should Danny recognize on the redemption of these bonds (ignore taxes)?

a. $126,000

b. $107,333

c. $84,000

d. $79,333

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Accounting Basics: Recognizing the redemption of bonds
Reference No:- TGS039629

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