Prepare the journal entry to record the redemption

On January 2, 2015, L Corporation issued $2,050,000 of 10% bonds at 96 due December 31, 2024. Interest on the bonds is payable annually each December 31. The discount on the bonds is also being amortized on a straight-line basis over the 10 years. (Straight-line is not materially different in effect from the preferable “interest method.”)

The bonds are callable at 101 (i.e., at 101% of face amount), and on January 2, 2020, L Corp. called $1,230,000 face amount of the bonds and redeemed them.

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Ignoring income taxes, compute the amount of loss, if any, to be recognized by L Corp. as a result of retiring the $1,230,000 of bonds in 2020. (Round answer to 0 decimal places, e.g. 38,548.)

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Loss on redemption $enter a dollar amount of loss on redemption rounded to 0 decimal places

Prepare the journal entry to record the redemption. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date Account Titles and Explanation Debit Credit
January 2, 2020 enter an account title to record the transaction on January 2, 2017 enter a debit amount enter a credit amount
enter an account title to record the transaction on January 2, 2017 enter a debit amount enter a credit amount
enter an account title to record the transaction on January 2, 2017 enter a debit amount enter a credit amount
enter an account title to record the transaction on January 2, 2017 enter a debit amount enter a credit amount

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