3) On January 2, 2018, the Expansion Company sold a 10%, $10,000 face value bond with a maturity date of December 31, 2027 (i.e., the bond matures in 10 years). The required cou- pon payments are to be made annually each December 31st. The bond was sold for $8,870 (rounded to nearest whole dollar) thereby giving an effective yield to maturity of 12%. Which of the following is a correct statement: A) Tho bond was sold at a discount of $1,200. B) Interest expense to be charged against income during the year 2018 (based on the ef- fective intefest method) is $887. E C) The net book value of the bonds payable at December 31, 2018 (the end of the first year the issue is orthstanding) is $8,934 (rounded). D) If the bond is redeemed for $9.400 after the coupon payment on December 31, 2024 (i.e., at the end of the seventh year), the Expansion Company will recognize a loss on redemption of $313. E) If the bond remains outstanding until its maturity date of December 31, 2027, the total interest to be charged against income over the 10-year period will be $10,640