Merchant Company issued 10-year bonds on January 1. The 8% bonds have a face value of $722,000 and pay interest every January 1 and July 1. The bonds were sold for $600,061 based on the market interest rate of 9%. Merchant uses the effective interest method to amortize bond discounts and premiums. On July 1 of the first year, Merchant should record interest expense (round to the nearest dollar) of a. $28,880 Ob. $32,490 c. $24,002 Od. $27,003