DRM Corporation Leased a Piece of Machinery and Correctly Classified

DRM Corporation leased a piece of machinery and correctly classified and recorded it as a finance lease. At the date of signing, January 1, 2017, the asset and lease obligation were recorded for $42,000. The first lease payment of $8,200 was due December 31, 2017 and the interest rate they used in their calculations was 7%. The lease term was 10 years. Which of the following best describes what would be reported on AFC's Statement of Income for the year ending December 31, 2017?

A) $8,200 Lease Expense
B) $8,200 Lease Expense, $4,200 Depreciation Expense
C) $2,940 Interest Expense, $1,260 Depreciation Expense
D) $2,940 Interest Expense, $4,200 Depreciation Expense