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Mandarin Company has 9%, 20-year bonds outstanding with a par value of $500,000 and a carrying...

Mandarin Company has 9%, 20-year bonds outstanding with a par value of
$500,000 and a carrying value of $475,000. The company calls the bonds at
$482,000. Calculate the gain or loss on the retirement of these bonds.?

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Answer #1

Gain or loss on the retirement of bonds = Call value of bonds-Carrying value of bonds

= 482000-475000

Loss on the retirement of bonds = 7000

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