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During 2017, Brandon Inc

Question 63

Multiple Choice

During 2017, Brandon Inc.purchased 2,000, $1,000, 9% bonds.The bonds mature on March 1, 2019, and pay interest on March 1 and September 1.The carrying value of the bonds at December 31, 2017 was $1,960,000.On September 1, 2018, after the semi-annual interest was received, Brandon sold half of these bonds for $988,000.Brandon uses straight-line amortization and has accounted for the bonds under the amortized cost model.The gain on the sale is


A) $11,200.
B) $8,000.
C) $4,800.
D) $0.

Correct Answer:

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