On January 1 of Year 1, Will Smith Co. issued $4,000,000 of 6% bonds that pay interest semiannually on January 1 and July 1. The bond issue price is $3,630,000 and the market rate of interest for similar bonds. The bond premium or discount is being amortized at a rate of $12,333 every six months. The amount of interest expense recognized by Will Smith Co. on the bond issue in Year 1 would be:

A) $132,333

B) $215,334

C) $240,000

D) $264,666

E) $280,000