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Elemental, Inc. accepts a $1,200,000 note on January 1 issued by Oread Corporation. Specifically, Oread will issue a non-interest-bearing note with $1,200,000 due in 10

Elemental, Inc. accepts a $1,200,000 note on January 1 issued by Oread Corporation. Specifically, Oread will issue a non-interest-bearing note with $1,200,000 due in 10 years in exchange for cash. The current market rate is 5%. Interest is compounded annually. Elemental is a calendar-year firm that prepares financial statements annually.

Elemental will report ___?___ as the notes receivable on January 1.

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