A company hopes to have sufficient cash to redeem the bonds one year before maturity. The company can afford to buy back the bonds on the open market at the market price of 101. Assume that the bonds have an unamortized premium/(discount) of $22,222,222.22 at the end of year 2. Bond interest is currently fully paid and recorded up to the date of retirement.

Based on this information what is the gain or loss on retirement of these bonds? And is this gain or loss a real economic gain or loss?