On July 1, 2006, Kitel, Inc

On July 1, 2006, Kitel, Inc. issued 9% bonds in the face amount of $5,000,000, which mature on July 1, 2016. The bonds were issued for $4,695,000 to yield 10%, resulting in a bond discount of $305,000. Kitel uses the effective-interest method of amortizing bond discount. Interest is payable annually on June 30. At June 30, 2008, Kitel's unamortized bond discount should be

A) $264,050.
B) $255,000.
C) $244,000.
D) $215,000.