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A company issued $20,000,000, 7.8%, 20-year bonds to yield 8% (market rate) on June 1, 2007. Interest is paid on November 30 and May 31.

A company issued $20,000,000, 7.8%, 20-year bonds to yield 8% (market rate) on June 1, 2007. Interest is paid on November 30 and May 31. The proceeds from the bonds are $19,604,145. Using effective-interest amortization, how much interest expense will be recognized in 2007?

A. $1,568,498 B. $1,568,332 C. $780,000 D. $914,888

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