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Question(s) / Instruction(s):

A company has bonds outstanding with a par value of $100,000. The unamortized discount on these bonds is $5,000. The company retired these bonds by buying them on the open market at 99. What is the gain or loss on this retirement?

a)            $1,000 loss.

b)            $0 gain or loss.

c)            $1,000 gain.

d)            $4,000 loss.

e)            $4,000 gain.

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