On January 1,2X13,Soothing Massage Company Acquired,as a Long-Term Investment,20 Bonds

On January 1,2X13,Soothing Massage Company acquired,as a long-term investment,20 bonds with a face value of $1,000 each.The bonds have a 10-year life,a 10% coupon rate,and pay interest semi-annually every June 30 and December 31.If the bonds were purchased by Soothing Massage Company to yield 12% and were acquired for $17,705.90,what journal entry would Soothing Massage Company make on June 30,2X13,if the company sold the bonds for $18,000.00? Assume the bonds were sold after Soothing Massage Company properly recorded the receipt of the June 30,2X13,interest payment.

A) $\begin{array}{lcc} \text { Cash } & 18,000.00 \\\text {Loss on Disposal of Bonds } & 2,000.00& \\\quad\text { Investment in Bonds }&&2,000,00\end{array}$

B) $\begin{array}{lcc} \text { Cash } & 18,000.00 \\\text {Loss on Disposal of Bonds } &905.90& \\\quad\text { Investment in Bonds }&&18,905,90\end{array}$

C) $\begin{array}{lcc} \text { Cash } & 18,000.00 \\\text {Gain on Disposal of Bonds } &&94.10& \\\quad\text { Investment in Bonds }&&17,905,90\end{array}$

D) $\begin{array}{lcc} \text { Cash } & 18,000.00 \\\text {Gain on Disposal of Bonds } &&231.75& \\\quad\text { Investment in Bonds }&&17,768.25\end{array}$

E) $\begin{array}{lcc} \text { Cash } & 18,000.00 \\\text {Gain on Disposal of Bonds } &&294.10 \\\quad\text { Investment in Bonds }&&17.705,90\end{array}$