On January 1, 2016, Company A. purchased an industrial furnace. In payment, Company A signed a noninterest-bearing note requiring $80,000 to be paid on December 31, 2017. If Company A had borrowed cash to buy the furnace, the bank would have required an interest rate of 7%.

What does the discount on note payable represent for Company A?

		Future interest expense that will be recognized over the life of the loan
		Future interest revenue that will be recognized over the life of the loan
		The amount of cash that Company A will receive for interest over the life of the loan
		The amount of cash that Company A will pay for interest over the life of the loan