101. The December 31, 2024 balance sheet of Hess Corporation includes the following items: 9% bonds payable due December 31, 2026 Unamortized premium on bonds payable $5,000,000 135,000 The bonds were issued on December 31, 2016, at 103, with interest payable on July 1 and December 31 of each year. Hess uses straight-line amortization. On March 1, 2025, Hess retired $2,000,000 of these bonds at 98 plus accrued interest. What should Hess record as a gain on retirement of these bonds? a. $76,000. b. $77,000. c. $75,000. d. $100,000. Ans: C, LO: 2, Bloom: AP, Difficulty: Difficult, Min: 4, AACSB: Knowledge, AICPA BC: None, AICPA AC: Measurement Analysis and Interpretation, AICPA PC: None, IMA: Reporting & Control: Financial Recordkeeping, IFRS: None Solution: $135,000 2 $5,135,000- x x.4 18 6 $2,053,000 (CV of retired bonds); $2,053,000 - ($2,000,000 .98) = $93,000.