On January 1, 20X1, Local Bakery started operations. The company acquired a piece of equipment by issuing a note payable on that date. The note had a below market rate of interest. Terms of the purchase of the equipment: Coupon rate Market rate Note payable $165,000 1.65% 4.70% Note term 6 years The note is due in equal annual payments of principle and interest. The company uses straight-line depreciation for book purposes. Depreciation information on the equipment: Useful life of the equipment, no salvage 10 years 20X1 Tax depreciation $33,000 Tax rate 21% What is the balance of deferred taxes payable-depreciation at December 31, 20X1? Multiple Choice 3,465 3,797 4,007 18,082