On January 1, 2014, the Minton Company borrowed $174,000 cash from the Hometown Bank by issuing a five-year 8% term note. The principal and interest are repaid by making annual payments beginning on December 31, 2014. The annual payment on the loan was $40,875.

The amount of principal repayment included in the December 31, 2014 payment is:

On January 1, 2014, the Minton Company borrowed $174,000 cas payments beginning on December 31, 2014. The annual payment The amount of principal repayment included in the December 31, O $13,920 O $26,955. O $37605 O $40,875