On July 1, 2020 Valen Company issues $3,000,000 of 10-year, 8.5% bonds at 102. Valen uses the straight-line method of amortization, Interest is paid each June 30 and December 31. The interest expense recognized on the first semiannual interest payment on December 31, 2020 is:

$130,500

$130.050

$124,500

$127,500