On December $31,2025,$ Novak Company signed a $$1\mathrm{.}278,400$ note to Splish Bank. The market interest rate at that time was $10\%.$ The stated interest rate on the note was $8\%,$ payable annually. The note matures in $5$ years. Unfortunately, because of lower sales, Novak's financial situation worsened. On December $31,2027,$ Splish Bank determined that it was probable that the company would pay back only $$767,040$ of the principal at maturity. However, it was considered likely that interest would continue to be paid, based on the $$1,278,400$ loan.