Expanding Corporation financed a $500,000 expansion by mortgaging their head office building for seven years. They negotiated a rate of 5% per annum. They will make equal annual payments at the end of the year. Note: if needed, complete the amortization table for the mortgage using the effective interest method How much is the interest expense in Year 3?

Multiple Choice

• $19,181

• None of the other alternatives are correct

• $13,072

• $9,960

• $24,954