On January 1, 2018, Elliot Company sold $400,000 of 10% ten-year bonds. Interest is payable semiannually on June 30 and December 31. The bonds were sold for $354,000 priced to yield 12%. Elliot records interest at the effective rate. Elliot should report bond interest expense for the six months ended June 30, 2018 in the amount of

$21,240

$20,000

$24,000

$17,500