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Sergio Acquires a $100,000 Ternco Corporation Bond (5%,20-Year Bond)on January

Question 131

Multiple Choice

Sergio acquires a $100,000 Ternco Corporation bond (5%,20-year bond) on January 1,2016 for $75,000.The bond had been issue on January 1,2014.If Sergio hold the bond to maturity,at redemption he will recognize


A) $0 gain or loss.
B) ordinary income.
C) a long-term capital gain.
D) a mix of ordinary income and long-term capital gain.

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