Corp. A purchased a bulding Sept. 1, 2007 from Corp. B by paying $100,000 cash and issuing a one-year note payable for the balance of the price. Interest on the note is stated at an annual rate of 9% and is paid at maturity. In its Dec. 31, 2007 balance sheet Corp A correctly presented the note and interest payable as follows:
Interest Payable 15,000
Notes Payable w/9% interest due 7/1/08 500,000
What is the amount of interest expense Corp A will recognize in 2008?
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