Amortize Discount by Interest Method

On the first day of its fiscal year, Ebert Company issued $50,000,000 of 10-year, 7% bonds to finance its operations. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 9%, resulting in Ebert Company receiving cash of $43,495,895. The company uses the interest method.

b. Compute the amount of the bond interest expense for the first year. Round amounts to the nearest dollar.