Answer:
d. $4,400 gain
Explanation:
The computation of gain or loss on the redemption is shown below:
= (Outstanding bonds value + unamortized premium) - (Outstanding bonds value × bond redeemed percentage)
= ($1,000,000 + $14,400) - ($1,000,000 × 101%)
= ($1,014,400) - ($1,010,000)
= $4,400 gain
Simply we take the difference between the total amount of bond including premium and redemption value so that the correct gain or loss should be recorded
