The following balances are from the statement of financial position of Merit Ltd.

Additional information:
a. A portion of the 7% bond payable was retired at 101. Discount amortization of $14,700 was recorded during the year.
b. A portion of the 6.5% bond payable was retired at 97.5. Discount amortization of $5,200 was recorded during the year.
c. The 7.25% bond was issued in 20X9 in exchange for land. Discount amortization of $17,200 has been recorded during the year.
d. Interest expense was $2,110,000 for the year.

Required:
1. Prepare statement of cash flows items in financing activities related to the bond issuance and retirement.
2. Calculate the cash paid for interest in 20X9.
3. Calculate the gain or loss on bond retirements in 20X9.

Transcribed Image Text:

Account Bonds payable, 7% Discount on bonds payable Bonds payable, 6.5% Discount on bonds payable Bonds payable, 7.25% Discount on bonds payable 20X9 $17,000,000 116,800 4,000,000 21,300 5,000,000 132,000 20X8 $20,000,000 152,500 10,000,000 61,500 0 C