Winrow Company received proceeds of $565,500 on 10-year, 8% bonds issued on January 1, 2013. The bonds had a face value of $600,000, pay interest annually on December 31st, and have a call price of 101. Winrow uses the straight-line method of amortization. Winrow Company decided to redeem the bonds on January 1, 2015. What amount of gain or loss would Winrow report on its 2015 income statement?
A) $27,600 gain
B) $33,600 gain
C) $33,600 loss
D) $27,600 loss

Question

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The Answer of Winrow Company received proceeds of $565,500 on 10-year, 8% bonds issued on January 1, 2013. The bonds had a face value of $600,000, pay interest annually on December 31st, and have a call price of 101. Winrow uses the straight-line method of amortization. Winrow Company decided to redeem the bonds on January 1, 2015. What amount of gain or loss would Winrow report on its 2015 income statement?
A) $27,600 gain
B) $33,600 gain
C) $33,600 loss
D) $27,600 loss

Winrow Company Received Proceeds of $565,500 on 10-Year, 8% Bonds