On 1 January 2013, Diab Services Issued $140 000 of 4-

Multiple Choice

On 1 January 2013, Diab Services issued $140 000 of 4- year debentures with a stated rate of 9%. The market rate at time of issue was 8%, so the debentures were issued with a premium and sold for $144 758. Diab uses the effective- interest method to amortise debenture premium. Half- yearly interest payments are made on 30 June and 31 December of each year. How much interest expense will be recorded when the first interest payment is made?

A) $6 300
B) $1 050
C) $5 790
D) $11 200