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Financial Accounting

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Notes Payable: Determine Interest Rate Full Year Interest

FINACT-XJY3KN

XYZ Company signs a 2-year, interest-bearing note on January 1, 20x4 for \$20,000. No interest or principal payments have been made during the year. If XYZ reports Interest Payable in the amount of \$1,200 on the Balance Sheet at December 31, 20x4, what is the annual interest rate on the note?