andusky Company borrowed $20,000 from the Lakeside Bank by issuing a 10% three-year installment note. Sandusky agreed to repay the principal and interest by making annual payments in the amount of $8,042.30. Based on this information, the amount of the interest expense associated with the second payment would be: (round your answer to the nearest dollar)

$894.

$1,396.

$2,681.

$2,000.