Assume that a Parent Company owns 100 percent of its Subsidiary. Each of the following independent scenarios describes an intercompany bond transaction between the Parent and the Subsidiary. For each independent case, determine the amount of gain or loss on constructive retirement of the bond reported in the consolidated income statement for the year ended December 31, 2019. Assume straight-line amortization.
a. On June 30, 2019, P issues directly to S bonds that have a par value of $150,000. S paid $156,000 for the bonds. The term of the bonds is 10 years and they have an 8 percent stated interest rate. Interest is paid annually on December 31.

b. On January 1, 2015, P issues to an unaffiliated company bonds that have a par value of $150,000. The unaffiliated company paid par value for the bonds. On December 31, 2019, S paid $105,000 for 70 percent of the outstanding bonds. The bond term is 10 years and they have an 8 percent stated interest rate. Interest is paid annually on December 31.

c. On January 1, 2015, P issues to an unaffiliated company bonds that have a par value of $150,000. The unaffiliated company paid 103 percent of par value for the bonds. Five years later, S paid $142,500 for all of the outstanding bonds. The bond term is 10 years and they have an 8 percent stated interest rate. Interest is paid annually on December 31.

d. On January 1, 2015, S issues to an unaffiliated company bonds that have a par value of $150,000. The unaffiliated company paid 96 percent of par value for the bonds. Five years later, P paid $108,150 for 70 percent of the outstanding bonds. The bond term is 10 years and they have an 8 percent stated interest rate. Interest is paid annually on December 31.