On January 1, 2022, Pipestone Corporation issued a four-year, $40,000,7% bond. The interest is payable annually each December 31 . The issue price was $38,675 based on an 8% effective interest rate. Pipestone uses the effective-interest amortization method. The interest expense on the income statement for the year ended December 31,2022 is closest to: Multiple Choice $3,532. $2,800. $2,707. $3,094