On January 1, 2020, Sauder Corporation signed a five-year noncancelable lease for equipment. The terms of the lease called for Sauder to make annual payments of $150,000 at the beginning of each year for five years with the title passing to Sauder at the end of this period. The equipment has an estimated useful life of 7 years and no salvage value. Sauder uses the straight-line method of depreciation for all of its fixed assets. Sauder accordingly accounts for this lease transaction as a finance lease. The minimum lease payments were determined to have a present value of $625,479 at an effective interest rate of 10%. In 2020, Sauder should record interest expense of

Group of answer choices

$62,547.

$87,453.

$102,453.

$47,548.