4. (LT Note Payable): ABC Corp. bought a piece of equipment in exchange for a Note Payable on January 1st 2021. The face value of the note was $890,000. The note is a 3 year note with a rate of 8%. The 8% is a reasonable rate of interest!
No interest is paid until the very end.
Required: Show Your Work.
1. Show the Journal entry for the purchase of this equipment, the next 3 years of interest expense, and the payoff on the note in 2024.