Hunter Corporation holds 80 percent of the voting shares of Moss Company. On January 1, 2008, Moss purchased $100,000 par value 12 percent first…

Hunter Corporation holds 80 percent of the voting shares of Moss Company. On January 1, 2008, Moss purchased $100,000 par value 12 percent first mortgage bonds of Hunter from Cruse for $115,000. Hunter originally issued the bonds to Cruse on January 1, 2006, for $110,000. The bonds have a 8-year maturity from the date of issue. Moss’ reported net income of $65,000 for 2008, and Hunter reported income (excluding income from ownership of Moss’s stock) of $90,000.Based on the information given above, what gain or loss on the retirement of bonds should be reported in the 2008 consolidated income statement? A. $6,250 gainB. $7,500 gainC. $7,500 lossD. $6,250 lossThe answer is C. i would like to konw, how to get C. Thanks.

Question:Hunter Corporation holds 80 percent of the voting shares of Moss Company. On January 1,2008, Moss purchased $100,000 par value 12 percent first mortgage bonds of Hunter fromCruse for…

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