How to figure gain on retirement of bond. Parent issues bond for 10M at 1.06. Sub buys 40% at 96.6. after year 3. Question: Elimination entries for end of year 1
belongs to book: ADVANCED ACCOUNTING|Debra C.jeter, Paul K.Chaney|7th edition| Chapter number:6| Question number:11
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Accounting
DR B/P 4,000,000
need an explanation for this answer? contact us directly to get an explanation for this answerDR Int Rev 368,000 (360+8 prem amort)
DR Prem on BP 192,000 (600-(30x4)=480x.4
CR Int Exp 348,000 (360-12 discount amort)
CR Invest in S 3,872, (9,660+20)x.4 (note:20 is 1yr amort)
Gain on Sale 340,000 (400-(400x0.966)