Question - The December 31, 2006, balance sheet of Eddy Corporation includes the following items:
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9% bonds payable due December 31, 2015
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$1,000,000
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Unamortized premium on bonds payable
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27,000
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The bonds were issued on December 31, 2005, at 103, with interest payable on July 1 and December 31 of each year. Eddy uses straight-line amortization. On March 1, 2007, Eddy retired $400,000 of these bonds at 98 plus accrued interest. What should Eddy record as a gain on retirement of these bonds? Ignore taxes.