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Bargain Company has $1,600,000 of bonds outstanding. The unamortized premium is $21,600. If the company redeemed the bonds at 101, what would be the gain or loss on the redemption? Group of answer choices $5,600 gain $5,600 loss $16,000 gain $16,000 loss

Respuesta :

Answer:

5,600 gain

Explanation:

The computation of the gain on the redemption is shown below:

= ($1,600,000 + $21,600) - ($1,600,000 × 101%)

= $1,621,600 - $1,616,000

= $5,600 gain

Hence, the gain on the redemption is $5,600

The same is to be relevant and considered

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