If You Purchased a 6% Bond at Par Value and Sold

Multiple Choice

If you purchased a 6% bond at par value and sold it 12 months plus 1 day later for $1100, the taxable income you would have realized over the holding period is

A) $100 long term capital gain.
B) $160 ordinary income gain.
C) $60 ordinary income and $100 short-term capital gain.
D) $60 ordinary income and $100 long-term capital gain.