Sheridan Company purchased $1150000 of 9% bonds of Scott Company on January 1, 2021, paying $1078342. The bonds mature January 1, 2031; interest is payable each July 1 and January 1. The discount of $71658 provides an effective yield of 10%. Sheridan Company uses the effective-interest method and plans to hold these bonds to maturity. For the year ended December 31, 2021, Sheridan Company should report interest revenue from the Scott Company bonds of:

$107942.

$107834.

$110666.

$103500.