Kaleidoscope Paint On January 1, Year 1, This Company Issued $500,000, 10-Year

Kaleidoscope Paint
On January 1, Year 1, this company issued $500,000, 10-year, 9% bonds for $480,745. The bonds pay interest on June 30 and December 31. The market rate is 10%. The company plans to use the effective interest method of amortizing bond discounts and premiums. Refer to the PV table on pages 717 to 720 of the text.
-Refer to the figure Kaleidoscope Paint.What is the interest expense on the bonds at June 30,Year 1?

A) $21,634
B) $22,500
C) $24,037
D) $43,267