1.Latvia Limited made a loan to Lithuania Incorporated in exchange for a $250,000 note on July 1, 2021. This note is for a period of seven years, with interest at 4% quarterly. Assume the market rate for comparable loans is 8%. Prepare the journal entry in good form for Latvia Limiteds books. (including amounts for variables, e.g. N = X, I = Y, etc.).

2. Estonia Incorporated obtained a $75,000 zero interest bearing note on August 1, 2021. The period was for twelve years, with a present value of $26,665.50. In addition to preparing the journal entry on the issuance date, provide a calculation for the implicit interest rate.