Redstone Inc. has the following debt outstanding on December 31, 2010: LO3 Example 12-1, 12-3, 12-4 LO3 10% bonds payable, due 12/31/14 $500,000 Discount on bonds payable (40,000) $460,000 On this...

Redstone Inc. has the following debt outstanding on December 31, 2010: LO3 Example 12-1, 12-3, 12-4 LO3 10% bonds payable, due 12/31/14 $500,000 Discount on bonds payable (40,000) $460,000 On this date, Redstone retired the entire bond issue by paying cash of $510,000. Required 1. Identify and analyze the transaction to record the bond retirement. 2. Describe how the bond retirement would be reported on the statement of cash fl ows assuming that Redstone uses the indirect method