On february 1, 2015, davis corporation issued 12%, $1,000,000 par, 10-year bonds for $1,117,000. davis reacquired all of these bonds at 102% of par, plus accrued interest, on may 1, 2018, and retired them. the unamortized bond premium on that date was $78,000. required: before income taxes, what was davis’s gain or loss on the bond extinguishment?

gain on the bond extinguishment 58,000

Explanation:

Carrying value of the bonds at redemption:

face value + unamortized premium on bonds

1,000,000 + 78,000 = 1,078,000

are retired at 102%

1,000,000 x 102% = 1,020,000

Gain on the bond extinguishment

carrying value - retired:

1,078,000 - 1,020,000 = 58,000

the journal entry will be:

bonds payable 1,000,000

premium on bond 78,000

          cash                                      1,020,000

         gain on bond redemption         58,000

answer; (15,000)workers each

the answer is     d. in our global economy, most job growth will be in services, but manufacturing jobs will exist, too.