Redemption of a Bond at Maturity On March 31, 2010, Sammonds Inc. issued $250,000 face value bonds

Question:

Redemption of a Bond at Maturity On March 31, 2010, Sammonds Inc. issued $250,000 face value bonds at a discount of $7,000. The bonds were retired at their maturity date, March 31, 2020.

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, 2020. Indicate the effect on the accounting equation of the redemption of the bonds.

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...