Par Inc owns 76.69% of Sub Corp. On January 1, Year 3, Sub purchased $139,636 face value of Par's 10.71% bonds for $115,996. On that date, Par's total bond liability consisted of $279,272 face-value bonds with an unamortized bond discount of $23,292. Interest payments are June 30 and December 31 each year. Straight-line method is used for bond amortization. Both companies have a Dec 31 year end. What would be the pre-tax gain or loss to the combined entity on the intercompany sale of the bonds?

a. $12,294

b. $11,694

c. $12,594

d. $11,394

e. $11,994