Jacobs Company issued bonds with a par value of $300,000 on January 1, 2016. The bonds were issued at 102, and had a 5 year term to maturity. The 9% coupon rate was payable in cash once a year on December 31. Using straight line amortization, the recognition of interest expense on December 31, 2016 will: A. decrease equity by $25,800, decrease liabilities by $1,200, and decrease assets by $27,000 B. decrease both assets and equity by $25,800 C. decrease both assets and equity by $27,000 D. decrease liabilities by $1,200, decrease assets by $25,800 and decrease equity by $27,000