When bonds are retired prior to maturity with proceeds from a new bond issue, gain or loss from the early extinguishment of debt, if material, should be

Question

Quizplus · Accepted Answer

According to the accounting principles, gain or loss from the early extinguishment of debt should be recognized in income from continuing operations in the period of extinguishment. This is because it reflects the current financial position and operating performance of the company rather than being an extraordinary item. Therefore, choice D is the best option.

When Bonds Are Retired Prior to Maturity with Proceeds from a New