Name: Date: Cells highlighted in green contain a drop-down arrow; select the appropriate account/response from the When the calculations for questions 1-6 are correct, the cells will change to yellow. On January 1, 2021, Chase Bros. issues $700,000 of 10%, 15-year bonds at a price of 97%. Six years later, on January 1, 2027 Chase retires 20% of these bonds by buying them on the open market at 104%. All interest is accounted for and paid through December 31, 2026, the day before the purchase. The straight-line method is used to amortize any bond discount. 1. How much does the company receive when it issues the bonds on January 1, 2021? Cash proceeds from sale of bonds at issuance 2. What is the amount of the discount on the bonds at January 1, 2021? Amount of discount 3. How much amortization of the discount is recorded on the bonds for the entire period from January 1, 2021, through December 31, 2026? Amortization of discount 4. What is the carrying (book) value of the bonds and the carrying value of the 20% soon-to-be-retired bonds as of the close of business on December 31, 2026? Entire Group Retired 20% Par value Remaining discount Carrying value (enter as a negative amount) 5. How much did the company pay on January 1, 2027, to purchase the bonds that it retired? Purchase price 6. What is the amount of the recorded gain or loss from retiring the bonds? (if a loss on retirement, enter as a negative amount) 7. Prepare the journal entry to record the bond retirement at January 1, 2027. General Journal Debit Credit Date 1/1/27