Bonds Payable has a balance of $884,000 and Discount on Bonds Payable has a balance of $8,840. If the issuing corporation redeems the bonds at 97.5, what is the amount of gain or loss on redemption?

a.$8,840 loss

b.$13,260 loss

c.$13,260 gain

d.$8,840 gain

Franklin Corporation issues $100,000, 10%, five-year bonds on January 1 for $104,500. Interest is paid semiannually on January 1 and July 1. If Franklin uses the straight-line method of amortization of bond premium, the amount of bond interest expense to be recognized on July 1 is

a.$8,000

b.$4,550

c.$4,000

d.$4,450

If $1,053,000 of 8% bonds are issued at 102 3/4, the amount of cash received from the sale is

a.$1,053,000

b.$789,750

c.$1,081,958

d.$1,137,240