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On January 1, 2007, Abel Co. exchanged equipment for a $160,000 noninterest-bearing note due on January 1, 2010. The prevailing rate of interest for a note of this type at January 1, 2007 was 10%. The present value of $1 at 10% for three periods is 0.75. What amount of interest revenue should be included in Abel's 2008 income statement?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M987687

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