Dickinson Inc. has the following debt outstanding on December 31, 2015:
On this date, Dickinson retired the entire bond issue by paying cash of $610,000.
REQUIRED:
1. Identify the accounting equation effects of recording the bond retirement.
2. Describe how the bond retirement would be reported on the statement of cash flows assuming that Dickinson uses the indirect method.

Question

Dickinson Inc. has the following debt outstanding on December 31, 2015:
  On this date, Dickinson retired the entire bond issue by paying cash of $610,000.
REQUIRED:
1. Identify the accounting equation effects of recording the bond retirement.
2. Describe how the bond retirement would be reported on the statement of cash flows assuming that Dickinson uses the indirect method.

Quizplus · Accepted Answer

The Answer of Dickinson Inc. has the following debt outstanding on December 31, 2015:
  On this date, Dickinson retired the entire bond issue by paying cash of $610,000.
REQUIRED:
1. Identify the accounting equation effects of recording the bond retirement.
2. Describe how the bond retirement would be reported on the statement of cash flows assuming that Dickinson uses the indirect method.