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An asset is acquired using a noninterest - bearing note payable for $ 1 0 0 , 0 0 0 due in two years. Management

An asset is acquired using a noninterest

-

bearing note payable for $

100, 000

due in two years. Management records the purchase with a debit to the asset for $

100, 000

and a credit to notes payable for $

100, 000 .

Which of the following statements is correct?

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