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On January 1,2012,Ace Electronics Borrowed $40,000 on a Five-Year,7% Note only the interest\bold{\text{only the interest}}

Question 121

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On January 1,2012,Ace Electronics borrowed $40,000 on a five-year,7% note.Ace will pay only the interest\bold{\text{only the interest}} on the loan on December 31 each year.The entire principal will be repaid on December 31,2016,the last interest payment date.Notes payable at December 31,2013 will be ________ notes payable at December 31,2012.


A) higher than
B) the same as
C) lower than
D) The answer cannot be determined from the information given.

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