Fairways West, Inc. has $500,000 of bonds payable outstanding. The bonds have an unamortized discount of $30,000. Management of Fairways West, Inc. would like to pay off the bonds. The bonds have a call price of 102 and Fairways West calls the bonds. Determine the gain or loss on the retirement of the bonds and prepare the journal entry required for the calling of the bonds.

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The Answer of Fairways West, Inc. has $500,000 of bonds payable outstanding. The bonds have an unamortized discount of $30,000. Management of Fairways West, Inc. would like to pay off the bonds. The bonds have a call price of 102 and Fairways West calls the bonds. Determine the gain or loss on the retirement of the bonds and prepare the journal entry required for the calling of the bonds.