When an interest-bearing note matures, the balance in the Notes Payable account is

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The balance in the Notes Payable account reflects the principal amount of the note. When an interest-bearing note matures, the total amount repaid by the borrower includes both the principal (the original amount borrowed) and the interest accrued over the term of the note. Therefore, the balance in the Notes Payable account is less than the total amount repaid, as it does not include the interest component.

When an Interest-Bearing Note Matures, the Balance in the Notes