On January 1 of Year 1, Congo Express Airways issued $3,240,000 of 8% bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $2,980,000 and the market rate of interest for similar bonds is 9%. The bond premium or discount is being amortized at a rate of $8,667 every six months. The amount of interest expense recognized by Congo Express Airways on the bond issue in Year 1 would be:

Multiple Choice

$241,866.

$291,600.

$276,534.

$259,200.

$138,267.