On February 1, 20x1, Davis Corporation issued 12%. $1,000,000 par, 10-year bonds for $1,117,000 Davis reacquired all of these bonds at 103% of par, plus accrued interest, on Mat 1, 20x3 and retired them. THe unamortized bond premium on that date was $75,000. Before income taxes, what was Davis's gain or loss on the bond extignishment?

A: Gain of $45,000

B: Loss of $45,000

C: Gain of $162,000

D: Loss of $162,000

E: Gain of $87,000