The result of a corporation buying back its own bonds for an amount that is less than the carrying value of the bonds. The amount of the gain is computed by subtracting the amount spent to repurchase the bonds from the bonds’ carrying value. The carrying value is usually the face amount of the bonds being retired plus the unamortized premium associated with the bonds being retired (or minus the bonds’ unamortized discount) minus the bonds’ unamortized issue costs.
Featured Review
"After working in accounts payable for 5 years, I applied for a similar position elsewhere. Given warning I would take an accounting exam, this English degree-holding gal crammed for a week using AccountingCoach. Come test time I was ecstatic to complete and pass the exam, leading to a job offer through which I am now making double what I was previously. I owe it all to AccountingCoach!" - Amanda C.
Join PRO or PRO Plus and Get Lifetime Access to Our Premium Materials
Read all 2,645 reviewsWe now offer 10 Certificates of Achievement for Introductory Accounting and Bookkeeping: