Alright, I'm doing a research project for my accounting class. I don't want the complete answer, I just want to be led to the right track. Here is the question:

City National Bank signed a loan agreement with State Electric Supply Company on January 2, 2019. The loan had the following terms:

Principal: $1,000,000

Term: 10- years

Interest rate: 7%

Annual Payment: $142,377.50

Points Received: $20,000

In connection with this transaction, City National Bank incurred the following costs:

Costs

Amount Paid Fees paid for loan Processing $5,000 (0.5% of balance)

Employee Bonus $10,000(1.0% of balance)

Advertising Costs $3,000

Preparation of loan docs. $2,000

City National Banks loan department manager, James Bean, is unsure how they should account for these costs and their impact on profitability. Should City National Bank Lending expense the costs associated with the loan, or can they defer them? If the costs are deferred, when should they be expensed?