On January 1, 2016, a Company Issued $400,000 of 10-Year

Multiple Choice

On January 1, 2016, a company issued $400,000 of 10-year, 12% bonds. The interest is payable semi-annually on June 30 and December 31. The issue price was $413,153 based on a 10% market interest rate. The effective-interest method of amortization is used. What is the book value of the bond liability as of June 30, 2016 (to the nearest dollar) ?

A) $400,000.
B) $416,495.
C) $409,811.
D) $403,342.