Soap Company issued $200,000 of 8%, 5-year bonds on January 1, 20X6. The discount on issuance was $12,000. Bond interest is paid annually on December 31. On December 31, 20X8, Pumice Company purchased one-half of the outstanding bonds for $96,000. Both companies use the straight-line method of amortization. What amount of gain or loss from retirement of debt will be reported on the 20X8 consolidated financial statements? a. $1,600 gain. c. $1,200 gain. b. $1,600 loss. d. $1,200 loss. How do you calculate the answer?