A company issues $1,000,000 face value of 10-year bonds on January 1, 2015 when the market interest rate on bonds of comparable risk and terms is 5%. Th e bonds pay 6% interest annually on December 31. At the time of issue, the bonds payable refl ected on the balance sheet is closest to:

A . $926,399.

B . $1,000,000.

C . $1,077,217.