00:01
Hello students, we are given a question here at december 31 2016, the following balances existed for micpa corporation.
00:10
Okay, so we are given here bonds payable 6 percentage, $6 ,000 or $6 ,000, $6 ,000.
00:17
Discount on bonds payable, $50 ,000.
00:19
The bonds mature on 12 by 12, 312, 28, okay? it means that 31st december, 2008.
00:28
The state line amortization, amortization is used further we are stated that if a 60 percentage of the bonds are retired at 103 dollar on january 1 2018 so it 28 then what is the gain or loss on the early extinguishment okay so we are supposed to know that here as we are given that the annual discount will be annual discount okay so it will be obviously half of $50 ,000 so we can write here $50 ,000 divided by two it means $25 ,000 okay now here we are supposed to know that the balancing discount the balance the balance in a discount student discount amortization on amortization students on first is january 2028 1 january 2028 is equal to the 25 ,000 dollar okay now here we are supposed to know that the proceeds from 60 percentage redemption will be proceeds from 60 percentage redemption is equal to so obviously it will be the 6 lakhs dollar times 60 percentage, okay? and as well as times, as we are given 103 percentage, okay? so we can multiply it by 1003 percentage.
02:29
So basically here we are supposed to know that it is 6 lakh times.
02:35
It can be written as 60 divided by 100.
02:38
It can be written as 103 divided by 100.
02:42
Okay, students.
02:43
So here we are supposed to know that what we can state, two zeros will be cancelled out by two zeros and again those two zeros can be cancelled out by those 10 zeros so we can say that it should be like a 60 times 60 times 103 okay students so here we can just say that the 60 times 60 is nothing but equal to 3600 and times 1003 so what we will get it will be equal to 3 .70 ,800...
