All note payments include interest

Stated rate of interest = Market rate of interest for all notes

except Non-interest bearing notes.

Transaction:

Date1 2/31/19 Sold Equipment that has an cost of $475,000; and accumulated depreciation of$225,000

The company receivedin exchange a Note Which requires 6 annual payments of $50,000

The first payment occurs 12/31/20.T

he stated rate of interest for the note is 6%.

Requirement A: Record the original transaction, for the seller.

Record the transactions through 12/31/22

Seller

12/31/2019

12/31/2020

12/31/2021

12/31/2022

Purchaser:

01/01/2020

12/31/2020

12/31/2021

12/31/2022