On June 30, Year 7, Masaline Co. had outstanding 9%, $5,000,000 face value bonds maturing on

June 9, year 9. Interest was payable semiannually every June 30 and December 31. On June 30, Year 7,

after amortization was recorded for the period, the unamortized bond premium and bond issue costs

were $30,000 and $50,000, respectively. On that date, Masaline acquired all its outstanding bonds on

the open market at 98 and retired all of them. At June 30, Year 7, calculate the amount that Masaline

should recognize as a gain before taxes on the redemption of the bonds.