On January 1, 2021, an investor paid $296,000 for bonds with a face amount of $350,000. The stated rate of interest is 11% while the current market rate of interest is 13%. Using the effective interest method, how much interest income is recognized by the investor in 2021 (assume annual interest payments and amortization)? Multiple Choice $38,500 $32,560. $38,480. $45,500