Answer:
bonds payable 510,000 debit
premium on BP 15,300 debit
cash 499,800 credit
gain on redemption 23,500 credit
--to record redemption of bonds--
Explanation:
cash outlay:
face value x quote:
510,000 x 98/100 = 499,800
book value:
face value + premium
510,000 + 15,300 = 523,300
Gain on redemption: 523,300 - 499,800 =23,500
To journalize we write-off the bonds payable account, we credit the cash outlay and recognize the gain
