Asked by

Sherry Sutton
on Nov 18, 2024

verifed

Verified

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.
verifed

Verified Answer

LG
Ludybina GarzaNov 18, 2024
Final Answer:
Get Full Answer