$30,000 loss $32,000 gain $10,000 gain $28,000 loss On January 1, 2006, Goll Cor

Question

       $30,000 loss
       $32,000 gain
       $10,000 gain
       $28,000 loss

On January 1, 2006, Goll Corp. issued 1,000 of its 10%, $1,000 bonds for $960,000. These bonds were to mature on January 1, 2016, but were callable at 101 any time after December 31, 2009. Interest was payable semiannually on July 1 and January 1. On July 1, 2011, Goll called all of the bonds and retired them. Bond discount was amortized on a straight-line basis. Before income taxes, Goll's gain or loss in 2011 on this early extinguishment of debt was (Points : 5)

Explanation / Answer

ANs) $32,000 gain

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