Question

Clabber company has bonds outstanding with a par value of $109,000 and a carrying value of $102,700. if the company calls these bonds at a price of $99,500, the gain or loss on retirement is:

Answer 1

To get the loss or gain, think about the conveying estimation of the bonds with the sum we pay to recover the bonds. In the event that the conveying esteem is more greater than the money paid, there is a gain on the security retirement. In the event that the carrying value is not as much as the money paid, there is a loss on the security retirement.
So plugging in:Par value - 109,000Carrying Value - 102,700
There is a loss of $6,300.