On July 1, 2014, Brownlee Corporate issues $1, 500,000 of 10 - year, 7% bonds dated July 1, 2014 at 90. Brownlee uses the straight - line method of amortization. Interest is paid each July 1 and January 1. Brownlee Corporation's fiscal year end is June 30. The interest expense recognized for the first semiannual interest payment on January 1, 2015 is: $105,000. $60,000. $45,000. $52, 500