Blue Co. recorded a right-of-use asset of $270,000 in a 10-year operating lease. Payments of $40,238 are made annually at the end of each year. The interest rate charged by the lessor was 8% and was known by Blue. The balance in the right-of-use asset after two years will be:

Multiple Choice

$232,724.

$231,233.

$270,000.

$328,876.