On 1/1/2018, Jake buys a newly issued bond 5-year $5,000, 6% coupon rate bond for $4,594. Interest payments are made semi-annually. The market rate of return for bonds of similar risk is 8%. What is the amount of the bond discount that must be recognized as ordinary income on the first interest payment date (i.e., 6/30/2018)? Round to the nearest dollar.

Question 3 options:

	$0, because OID treatment does not apply to this bond
	$34
	$68
	$150 i choose D)150 but im not sure, please help 5,000*.06 = 300 300/2 = 150 i think that would be the interest but is it paid ordinary rate?