Question: On March 31, 2017, Sammonds Inc. issued $250,000 face value bonds at a discount of $7,000. The bonds were retired at their maturity date, March

On March 31, 2017, Sammonds Inc. issued $250,000 face value bonds at a discount of $7,000. The bonds were retired at their maturity date, March 31, 2027.

Required

Assuming that the last interest payment and the amortization of the discount have already been recorded, calculate the gain or loss on the redemption of the bonds on March 31, 2027. Identify and analyze the effect of the redemption of the bonds.

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