1. A company has bonds outstanding with a par value of $110,000. The unamortized premium on these bonds is $2,585. If the company retired these bonds at a call price of 99, the gain or loss on this retirement is:

a. $2,585 loss.

b. $1,100 loss.

c. $3,685 gain.

d. $1,100 gain.

e. $2,585 gain.

2. Fernwood Company is preparing the company's statement of cash flows for the fiscal year just ended. The following information is available:

Retained earnings balance at the beginning of the year	$ 253,000
Cash dividends declared for the year	55,000
Proceeds from the sale of equipment	93,800
Gain on the sale of equipment	5,100
Cash dividends payable at the beginning of the year	24,200
Cash dividends payable at the end of the year	32,000
Net income for the year	121,000

The ending balance in retained earnings is:

a. $324,100.

b. $245,600.

c. $319,000.

d. $374,000.

e. $327,700.