Question 25

In 2011, Mr. Yang paid $160,000 for a corporate bond with a $200,000 stated redemption value. Based on the bond's yield to maturity, amortization of the $40,000 discount was $3,024 in 2011 and $2,960 in 2012. Mr. Yang sold the bond for $169,500 in 2013. Which of the following is false assuming that he bought the newly issued bond from the corporation?

Group of answer choices

All of the statements are true.

Mr. Yang will have ordinary income of $3,024 in 2011 and $2,960 in 2012.

Mr. Yang will have ordinary income of $5,984 in 2013.

Mr. Yang will have a capital gain of $3,516 in 2013.