ACC Inter ch 14 14 Enterprise Group issued 100000 of 3year 6

ACC Inter ch 14

14. Enterprise Group issued $100,000 of 3-year, 6% bonds outstanding on December 31, 2015 for $104,000. Enterprise uses straight-line amortization. On April 1, 2016, $20,000 of the bonds were retired at 109. What is the credit to cash?

Solution

Calculate credit to cash :

Cash credit = 20000*109/100 = 21800

so answer is $21,800