On January 1, Year 1, Sheffield Co. issued bonds with a face value of $200,000, a term of ten years, and a stated interest rate of 6%. The bonds were issued at 105, and interest is payable each December 31. Sheffield uses the straight-line method to amortize the bond discount.

The carrying value of the bonds that would be reported on the December 31, Year 4 balance sheet is:

Multiple Choice

A. $204,000.

B. $200,000.

C. $205,000.

D. $206,000.