Answer:
Dr Bonds Payable 780,000
Dr Loss on Bond Redemption 95,600
Cr Discount on Bonds payable 80,000
Cr Cash 795,600
Step-by-step explanation:
Preparation of the journal entry to record the retirement or conversion of the bonds
Based on the information we were told that the Corporation made purchased of the amount of $780,000 of their bonds on June 30, 2020, at 102 in which they immediately retired them which means that if the carrying amount of the bonds on the retirement date was the amount of $700,000 and the bonds pay annual interest while the interest payment which was due on June 30, 2020 has already be made as well as recorded, the journal entry to record the retirement or conversion of the bonds will be :
Dr Bonds Payable 780,000
Dr Loss on Bond Redemption 95,600
(795,600+80,000-780,000)
Cr Discount on Bonds payable 80,000
(780,000-700,000)
Cr Cash 795,600
(780,000 x 102%)
(Being to record Redemption of Bonds)