Answer:
A)
Step-by-step explanation:
When debt is retired before the maturity date and the market interest rate increases a gain occurs because you paying less interest which lead to a lower debt. Once the debt matures the book value will always be equal to the market value because the market value is the total amount due with paying a fixed amount of installments with interest and the book value is the matured debt payed with interest. Interest on debt is an expense so you record it in the statement of profit and loss