Asked by
Sherry Sutton
on Nov 18, 2024Verified
There is a loss on redemption of bonds when bonds are redeemed above the carrying amount.
Loss On Redemption
The loss incurred when a debt obligation or security is redeemed before its maturity date at a value less than the original purchase price or par value.
Carrying Amount
The balance of the bonds payable account (face amount of the bonds) less any unamortized discount or plus any unamortized premium.
- Acquire knowledge on how bonds redemption is treated in accounting and its consequences on gains and losses due to redemption.
Verified Answer
LG
Learning Objectives
- Acquire knowledge on how bonds redemption is treated in accounting and its consequences on gains and losses due to redemption.