A lease financing company will purchase an asset and then lease it to another entity in order to earn interest income. If an asset costs the financing company $505000 (fair value), and the asset is leased out on January 1st, what is the interest income to be recognized at the end of the first year on December 31st if the financing company has an implicate rate of 6%?

Cannot be determined.

O $505,000.

O $30,300.

O The lease payments received in the first year.