Queen City Rentals issued 5-year, 7% bonds with a par value of $500,000. The market rate when the bonds were issued was 6.5%. The company received $505,000 cash for the bonds. The bonds were issued at a premium. Using the straight-line method, the amount of recorded interest expense for the first semiannual interest period is: $18,000 $17,500 $17,000 $5,000