Conti Products owed $80,000 on account for inventory purchased on December 1, 2020. Conti uses a perpetual inventory system and has a fiscal year that ends on December 31. Conti was unable to pay the amount owed by the March 1, 2021, due date because of financial difficulties.

On March 1, 2021, Conti signed a 4-month, $80,000, 6% interest-bearing note. This note was repaid with interest on July 1, 2021.

Required:

1. Prepare the entry recorded on December 1, 2020.

2. Prepare the adjusting entry recorded on December 31, 2020.

3. Prepare the entry recorded on March 1, 2021.

4. Prepare the entry recorded on July 1, 2021.