$7$

$3$ points

On January $1,$ Year $1,$ Booker Corporation issued a $$5,000$ face value bond that sold for $90.$ The bond had a five$-$year term and paid $10\%$ annual interest. The company used the proceeds from the bond issue to buy land. The land was leased for $$600$ of cash revenue per year and was sold at the end of the $5$ th year for $$4,200$ cash. The straight$-$line method of amortization is used. The amount of the cash outflow for interest expense in Year $3$ would be

$$600$

$1$

$$400$

$2$

$$500$

$$0$