Redemption of a Bond at Maturity On March 31, 2008, Sammonds Inc. issued $250,000 face value…

Redemption of a Bond at Maturity On March 31, 2008, Sammonds Inc. issued $250,000 face value…

Redemption of a Bond at Maturity

On March 31, 2008, Sammonds Inc. issued $250,000 face value bonds at a discount of $7,000. The

bonds were retired at their maturity date, March 31, 2018.

Required

Assuming that the last interest payment and the amortization of the discount have already been

recorded, calculate the gain or loss on the redemption of the bonds on March 31, 2018. Indicate

the effect on the accounting equation of the redemption of the bonds.

 

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