Sandhill Company issued its 9%, 25-year mortgage bonds in the principal amount of $2,920 000 on anuary 2 2003 at a disco of S 8 000, which it ceeded to amortize charges to expense over the life of the issue on a straight-line basis. The indenture securing the issue provided that the bonds could be called for redemption in total but not in part at any time before maturity at 104% of the principal amount, but it did not provide for any sinking fund On December 18, 2017, the company issued its 10%, 20-year debenture bonds in the principal amount of $4,290,000 at 103, and the proceeds were used to redeem the 996, 25-year mortgage bonds on January 2, 2018. The indenture securing the new issue did not provide for any sinking fund or for redemption before maturity. (a) Prepare journal entries to record the issuance of (1) the 10% bonds and (2) the redemption of the 9% bonds. (If no entry is required, select for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No Entry for the account titles and enter No. Date Account Titles and Explanation Debit Credit (1) December 18, 2017 (2) January 2, 2018 (b) Indicate the income statement treatment of the gain or loss from redemption The is reported as