Question

The Starks own a home in New York. They paid $1.2 million for the home several years ago. They originally took out a $1 million mortgage on the home. In the current year, the Starks refinanced their home at a time when the home was worth $2 million and the outstanding mortgage balance was $700,000. Their new mortgage is for $1.3 million. After the refinancing, the Starks's acquisition debt is: