Answer:
The gain on exthinguish will be 19,683
Explanation:
The bond had a carrying value of 421,620
They were purchase at 401,937
The gain on exthinguish will be 19,683
That's because the bonds payable were purchase from third parties.
The subsidiary already issued the bond in a previous period.
When the parent company purchase the bonds, they were retired from other entities, so it is not a intra-entity transaction, therefore produces gains or losses.
