Borrowers Who Retire Long-Term Liabilities Debit the Liability Account for Its

Borrowers who retire long-term liabilities debit the liability account for its current book value, credit Cash, and recognizes any difference on the retirement of the debt as a

A) gain when book value exceeds cash disbursement (credit) .
B) gain when cash disbursement exceeds book value (credit) .
C) loss when book value exceeds cash disbursement (debit) .
D) a financing loss (debit) .
E) cannot be determined from the above information.

Correct Answer:

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