[xiaolizhou]

Good afternoon all,
Question:
if a corporation retired $130,000 face value, 12% bonds on June 30,2005, at 102. The carrying value of the bonds at redemption date was $107,500. The bonds pay semiannual interest, and interest payment due on June 30,2005, has been made and recorded.

could you tell me if the following Journal Entry are correct or not.

June 30,2005
Bonds Payable 132,600
Discount on Bonds Payable 22,500
Gain on Bond Redemption 2,600
Cash 107,500

Thanks!

[littlecat87]

It is not correct.
Mine is
Bonds payable 130,000
Loss on bond redemption 25,100
Cash 132,600
Discount on bonds payable 22,500