I'm lost so far in this section! Can anyone help? Here's the problem and I know I'm doing it completely wrong.

The balance sheet of Indian River Electronics Corp as of Dec 31 2008 included 12.25% bonds having a face amount of $90mil. THe bonds had been issued in 2001 and had a remaining discount of $3mil at Dec 31 2008. On Jan 1 2009 Indain River Electronics called the bonds before their scheduled maturity at the call price of 102.

Prepare journal entry by Indian River Electronics to record the redemption of the bonds at Jan 1 2009.

This is where I've started:



Bonds Payable 90,000,000

Loss on Early Extinguishment 1,800,000

Discount on Bond Payable 3,000,000

Cash 88,800,000