A $100,000 bond was retired at 95 when the carrying amount of the bond was $103,000. The entry to record the retirement would include a:
A) loss on bond redemption of $3,000.
B) gain on bond redemption of $3,000.
C) gain on bond redemption of $8,000.
D) loss on bond redemption of $8,000.

Question

Quizplus · Accepted Answer

The bond was retired at 95% of its face value, which is $95,000. The carrying amount was $103,000, so the gain is $103,000 - $95,000 = $8,000.

A $100,000 Bond Was Retired at 95 When the Carrying