Prepare the journal entry to record the redemption

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On September 10, 2009, Mooney Plastic Products issued bonds with a face value of $500,000 for a price of 96. During 2012, Mooney exercised a call provision and redeemed the bonds for 101. At the time of the redemption, the bonds had a balance sheet value of $490,000.

a. Prepare the journal entry to record the redemption.

b. Assume that the bonds were issued in 2009 for 102, and at the time of redemption they had a balance sheet value of $507,000. Prepare the journal entry to record the bond redemption.

Reference no: EM131427427

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