A Corporation Issued 8% Bonds with a Par Value of $1,000,000,receiving

Multiple Choice

A corporation issued 8% bonds with a par value of $1,000,000,receiving a $20,000 premium.On the interest date 5 years later,after the bond interest was paid and after 40% of the premium had been written off,the corporation purchased the entire issue on the open market at 99 and retired it.The gain or loss on this retirement is:

A) $0
B) $10,000 gain
C) $10,000 loss
D) $22,000 gain
E) $22,000 loss