On 1 May 2017,Metro Company Has Debentures with Balances as Shown

Multiple Choice

On 1 May 2017,Metro Company has debentures with balances as shown below. $\begin{array}{l|r}{\text { Debentures payable }} \\\hline & 50000\end{array}$ $\quad\quad\begin{array}{r|}{\text { Discount on debentures }}& \\\hline 1140\end{array}$ If Metro redeems the debentures for $52 000,what will be the effect on the income statement?

A) There will be sales revenue of $3 140.
B) There will be a gain on redemption of $3 140.
C) There will be a loss on redemption of $3 140.
D) There will be no effect on profit.