Use the Following Information to Answer Questions

question 13

Multiple Choice

Use the following information to answer Questions
Parker Company owns 90% of the outstanding common stock of Stagger Company.On January 1, 2014, Stagger Company issued $500,000, 12%, ten-year bonds.
On January 1, 2013, Parker Company paid $315,000 for Stagger Company bonds with a par value of $300,000 and a carrying value of $297,600.Both companies use the straight-line method to amortize bond premiums and discounts.Parker Company accounts for the investment using the cost method of accounting.
-The total gain or loss on the constructive retirement of the debt to be reported in the 2013 consolidated income statement is

• A)$15,000 loss.
• B)$15,000 gain.
• C)$17,400 loss.
• D)$17,400 gain.
• E)$ 2,400 loss.

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Definitions:

Depression

A common and serious mood disorder that affects how you feel, think, and handle daily activities, characterized by prolonged feelings of sadness and/or a lack of interest in activities.

Interpersonal Therapy

A brief, attachment-focused psychotherapy that centers on resolving interpersonal problems and symptomatic recovery.

Cognitive-behavioral Therapy

A form of psychotherapy that treats problems and boosts happiness by modifying dysfunctional emotions, behaviors, and thoughts.

Psychoanalysis

A therapeutic approach and theory of psychology developed by Sigmund Freud that emphasizes unconscious processes and unresolved past conflicts.