Company S Is a 100%-Owned Subsidiary of Company P

Company S is a 100%-owned subsidiary of Company P. On January 1, 20X3, Company S has $100,000 of 8% face rate bonds outstanding. The bonds had 5 years to maturity on January 1, 20X3, and had an unamortized discount of $5,000. On that date, Company P purchased the bonds for $99,000. The net adjustment needed to consolidate retained earnings on December 31, 20X3 is ____.

A) $(4,000)
B) $(3,200)
C) $(800)
D) $0