Libby Company Purchased Equipment by Paying $5,000 Cash on the Purchase

Libby Company purchased equipment by paying $5,000 cash on the purchase date and agreeing to pay $5,000 every six months during the next four years; the first payment is due six months after the purchase date.Libby's incremental borrowing rate is 8%.At what amount would the liability be reported on the balance sheet as of the purchase date,after the initial $5,000 payment was made?

A) $45,000
B) $33,664
C) $38,664
D) $40,000