1 question 2 parts

When bonds and other debt are issued, costs such as legal costs, printing costs, and underwriting fees are referred to as debt issue costs. When debt issue costs are incurred: The recorded amount of the debt is increased by the debt issue costs. The decrease in the effective interest rate caused by the debt issue costs is reflected in the interest expense The increase in the effective interest rate caused by the debt issue costs is reflected in the interest expense The debt issue costs are recorded separately as an asset On January 1, 2016, F Corp. issued 2,500 of its 9%, $1,000 bonds for $2,596,000. These bonds were to mature on January 1, 2026, but were callable at 101 any time after December 31, 2019. Interest was payable semiannually on July 1 and January 1. On July 1, 2021, F called all of the bonds and retired them. The bond premium was amortized on a straight-line basis. Before income taxes, F Corp's gain or loss in 2021 on this early extinguishment of debt was: O $18,200 gain. O $27,800 gain. O $73,000 gain. $25,000 loss