Use the Following to Answer the Next Three Questions

Multiple Choice

Use the following to answer the next three questions:
A government entered into a capital lease agreement to acquire equipment for the general government on January 1, 2012. Five payments of $8,000 each are to be made, beginning on December 31, 2012. Discounting is at 6%, computed annually. The present value of the five payments is $33,699.
-On December 31,2012,the amount debited to Expenditures-Interest in the debt service fund would be:

A) $8,000.
B) $2,400.
C) $2,022.
D) $8,000