Tropic Incorporated has outstanding 100 million dollars of 6% bonds, due in 4 years. They are callable at 104. They bonds were issue at par and have a current market price of 98

1) If tropics retire 10 million of the bonds by purchasing them from bond holder at the current market price, How much gain or lost will be reported on the income statement

2)Assume that tropics call 10 million dollar of these bonds What will be the effect on the income statement

3) Refer to question A, how much cash will the company pay

Thanks

I got question 1 so far, a gain of 200,000 (10,000,000 X .98)
Bond Payable 10,000,000
Gain 200,000
Cash 9,800,000

Edit: didnt know why it didn't space properly, but above it is debit bond payable for 10 mil and credit gain for 200,000 and cash for 9,800,000